Category: Nigeria

IBADAN, Nigeria–The state-run Nigerian National Petroleum Corporation has secured $1.2 billion to drill wells offshore and onshore under a joint venture with Chevron Nigeria, the NNPC said Sunday. Nigeria has been criticized for failing to meet obligations to its oil JV partners, which has affected efforts to reach production targets of over 4 million barrels a day and reserves to 40 billion barrels. The $1.2 billion package will finance the development of 23 onshore and 13 offshore wells. The NNPC/CNL Joint Venture is the third largest oil producer in Nigeria, the statement said. Nigeria, Africa’s largest oil producer, relies on crude exports for over 90% of its foreign exchange earnings and 70% of government revenue, according to the International Monetary Fund.

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IBADAN, Nigeria–Nigeria will seek to renegotiate the fiscal terms of existing production-sharing contracts with some international oil and gas companies to seek more favorable terms, the new head of the Nigerian National Petroleum Corp. said. “In the weeks and months ahead, the corporation will be renegotiating the contracts to extract as much benefits as possible for Nigeria,” said NNPC chief Ibe Kachikwu, according to a statement. Speaking in Paris ahead of the state visit of Nigerian President Muhammadu Buhari, Kachikwu said: “The NNPC is allowed to make use of the window which creates space for renegotiation.” The major African oil exporter is facing hefty budget pressures after international oil prices plunged and as the Buhari administration looks for funds to execute an ambitious reform program. The new government had been expected to seek to renegotiate some contracts. Since assuming office in May, Buhari has sought to overhaul the NNPC […]

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Investors hoping that Nigeria’s central bank Governor Godwin Emefiele will succumb to pressure to devalue the naira weren’t aware of one crucial factor: he has the backing of President Muhammadu Buhari. In his first public comments on the currency since taking office in May, Buhari, 72, said on Wednesday he opposes a weakening of the currency. His stance endorses Emefiele’s policy of restricting foreign-exchange trading to stabilize the naira despite a plunge in oil revenue in Africa’s biggest crude producer. It also raises questions about the central bank’s independence and puts the two men at odds with foreign investors, local businesses and some members of the Monetary Policy Committee who say the naira is overvalued, deterring capital inflows and hindering economic growth. “There appears to be some unwritten agreement between the presidency and the central bank that the naira will not be devalued, in spite of the deteriorating fundamentals,” […]

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Nigerian states have drawn from a 300-billion naira ($1.5 billion) emergency fund at the central bank and are asking for more money as they struggle to pay civil service salaries after the oil-price slump. Eighteen states have tapped the intervention fund and more requests are being processed, Central Bank of Nigeria Governor Godwin Emefiele said in a statement e-mailed by the presidency on Thursday. Debts worth a total of 574 billion naira have been restructured for 23 states since August, it said. At least half of Nigeria’s 36 states, which rely on monthly federal handouts for the majority of their funding, have been unable to pay bureaucrats’ wages after Brent crude prices fell by half in the past year. Nigeria is Africa’s largest oil producer.

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* Oil price plunge hits Nigerian revenues, currency * Central bank rations dollars to hold naira peg * Yields on some Nigerian Eurobonds near record * Loans, dividends may be more problematic than bonds By Alexis Akwagyiram and Karin Strohecker LAGOS/LONDON, Sept 16 (Reuters) – Already feeling the pinch from slumping oil prices and slowing economic growth, Nigerian companies are finding it increasingly hard to get hold of foreign currency due to central bank restrictions and may struggle to repay their debts. Yields on a number of dollar corporate bonds have risen close to record highs this week, reflecting investors’ anxiety despite an assertion by Nigeria’s richest businessman that no borrower will default due to the currency shortage. Since 2007, Nigerian financial and energy firms such as FBN Holdings and Seven Energy have issued more than $5 billion of dollar-denominated debt on international capital markets, including almost $3 billion […]

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PREMIUM TIMES has uncovered one of the most fraudulent crude oil deals carried out by the administration of Goodluck Jonathan, which saw cronies of the president pocket billions of naira through a domestic crude oil transportation contract that violated Nigeria’s procurement and economic regulations. Our estimates indicate that the contracts, which the Nigerian National Petroleum Corporation has now admitted were unnecessarily exorbitant and inappropriately awarded, cost Nigeria N509.3 billion. How much service the companies offered to pocket that amount remains unclear even to the state oil company, insiders say. The deal, later disguised as security contract and channeled through the Nigerian National Petroleum Corporation, saw two companies belonging to Idahosa Okunbor and Tunde Ayeni, illegally rack up billions of naira to purportedly transport crude oil from Escravos to Warri refinery, and Bonny Island to Port Harcourt refinery, by ship, since 2011. The deal involved the transportation of five millions […]

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Esso Exploration & Production Nigeria Ltd. , a subsidiary of ExxonMobil Corp., has started oil production ahead of schedule at the Erha North Phase 2 project 60 miles offshore Nigeria ( OGJ Online, June 23, 2015 ). The deepwater subsea development lies in 3,300 ft of water and 4 miles north of Erha field, which has been producing since 2006 ( OGJ Online, May 2, 2006 ). The project includes seven wells from three drill centers tied back to the existing Erha North floating production, storage, and offloading vessel, reducing additional infrastructure requirements. Phase 2 is estimated to develop an additional 165 million bbl from the currently producing Erha North field. Peak production from the expansion is estimated at 65,000 bo/d, increasing total field production to 90,000 b/d. ExxonMobil expects to increase its global production volumes this year by 2% to 4.1 million boe/d, driven by 7% liquids growth. […]

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(file photo). Photo: Premium Times The Nigerian National Petroleum Corporation (NNPC) has finally bowed to the pressure mounted by the International Association of Independent Tanker Owners (INTERTANKO) and lifted a ban on 113 foreign vessels, mostly very large crude carriers (VLCCs) into Nigeria’s territorial waters less than two months after the ban was imposed. Acting on the directive of President Muhammadu Buhari, NNPC imposed the ban shortly after Buhari assumed office over concerns that most of the tankers were complicit in incidents of crude oil theft from Nigerian oil terminals. INTERTANKO, whose members were mostly affected by the ban of the 113 vessels, is one of the largest groups in the shipping industry with 207 full members and 285 associate members, and a registered fleet of over 3,000 tankers of over 270 million DWT (deadweight). In his capacity as the then Group General Manager of NNPC in charge of […]

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An oil pipeline in Nigeria. Growth in the Nigerian economy, Africa’s largest, slowed in the second quarter due to the slump in oil prices, the country’s statistics office said. Gross domestic product expanded 2.35 percent on an annual basis, compared with 3.96 percent a quarter earlier, the head of the National Bureau of Statistics, Yemi Kale, said on his Twitter account on Tuesday. The oil industry contracted 6.8 percent, Kale said. “This is not a good result for Nigeria,” Alan Cameron, a London-based economist at Exotix Partners LLP, said in e-mailed comments. “Moreover, with policy rates stuck at high levels, and fiscal policy being tightened automatically through lower statutory oil disbursements, it is hard to see any catalyst for improvement.” The central bank raised its key interest rate to a record high of 13 percent in November, since when inflation has accelerated beyond the bank’s target band of 6 […]

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Warri and Port Harcourt — Barely two weeks after it resumed operation, the Warri Refining and Petrochemical Company (WRPC) has been shut down. The development is coming on the heels of public excitement that followed news of the nation’s moribund refineries kicking back to life. The Guardian learnt that the refinery was shut down few days ago, as crude oil stored in its receptors ran out. "It goes to show the rot that has been embedded in the system over the years. Now that you have a Buhari government in place, everybody is running helter-skelter to do the needful and in the process they have forgotten to do proper planning. And as they say, when you fail to plan, you plan to fail. "Right now, you have a situation where everybody is in a hurry to do the right thing and they forget that you have to follow a […]

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