FG May Sell NNPC Joint Venture Stakes to China
By Ejiofor Alike with agency report, 10.01.2009



The Federal Government has said it may sell part of its interests in the joint venture between the Nigerian National Petroleum Corporation (NNPC) and some multinational oil companies to China.
The Financial Times had reported on Tuesday that China National Offshore Oil Company (CNOOC) was bidding for 6 billion barrels of Nigeria’s oil in a deal worth about $30 billion.
Minister of State for Petroleum, Mr. Odein Ajumogobia, in a chat with Reuters in Abuja yesterday, confirmed this development, but pointed out that China would not be given all the reserves it was seeking.
He, however, stated that the NNPC could sell stakes in joint ventures with existing oil partners if Beijing offered the right price. NNPC has 55 - 60 per cent interests in the joint ventures with international oil companies.
He said: “It's true that the Chinese have made a proposal which we are considering. They are asking for six billion barrels of oil from our reserves, but I can tell you that we are not going to give them all of that.”
Asked if the NNPC could sell its stakes to China, Ajumogobia said: “It's an option we are also looking at. Why not? If the offer is very good and very attractive, why not? NNPC has the right to do whatever it likes with its own share.”
Ajumogobia had earlier said the Federal Government was in talks with CNOOC.
“We are talking to them about their quest to buy proven reserves. This is not new; this predates this administration,” adding “we are not offering leases that are up for renewal in the middle of negotiations to renew. That is not happening,” he said.
Ajumogobia said the Chinese had identified a number of blocks in which they would be interested, including licences operated by Royal Dutch Shell, Chevron and ExxonMobil which originally expired last November and December 2008.
Chevron and Exxon won a year’s extension, meaning their licences are due to expire this year, while Shell successfully sought a court injunction allowing it to continue to operate while it challenged the expiry, an industry executive said.
Analysts have expressed the feelings that if the Chinese bid is successful, it could place the company in competition with major western groups including Total, Shell, Chevron and ExxonMobil, which operate the 23 blocks under discussion.
An industry source said the 23 oil mining leases identified as targets by CNOOC included Shell's Bonga field and Chevron's Agbami.
The Bonga licence does not expire until 2023, while Agbami expires in 2024.
The source said the ExxonMobil-operated Erha field is one of the Chinese targets.
“We have not invited anyone to discuss the possibility of leasing these proven reserves. The Chinese made an offer and said they had identified certain blocks including some already being exploited by some of our partners,” Ajumogobia had earlier said.
THISDAY had reported that CNOOC refused to comment on reports that it was negotiating lucrative oil blocks with the Federal Government.
President of CNOOC Ltd, Yang Hua, the listed arm that has been the main vehicle for the company's overseas investment, had declined to comment.
In a recent Chinese acquisition of Nigerian oil assets, Sinopec paid $7.24 billion for Swiss-based Addax Petroleum, which operates in Nigeria and other African states.
Meanwhile, the Movement for the Emancipation of the Niger Delta (MEND) has warned Chinese firms not to invest in the oil-rich region until a permanent peace deal has been achieved.
Spokesman of MEND, Jomo Gbomo, warned the Chinese firm in an emailed statement on Tuesday not to go ahead with the deal until permanent peace is attained in the region.
MEND said: “The Chinese should be careful about investments until there is justice in that region. We can guarantee that if the government of Nigeria fails to address the root issues, the Chinese will regret they were negotiating with the wrong people.”





Well, what do we stand to gain from selling our resources to outsiders?

I weep for Nigeria.These people are mortgaging the future of our children.

What exactly is this government trying to achieve?