Ground-breaking! Nigeria signs $80bn oil and gas deals with China
– Nigeria has signed a Memorandum of Understanding (MoU) with several Chinese companies for over $80 billion investments
– The new investments are expected to fund capital intensive projects in the upstream sector of the oil and gas industry
Dr. Ibe Kachikwu, the minister of state for petroleum resources, who was with a three-day official visit to Beijing, China, has reportedly signed Memorandums of Understanding (MoUs) with some Chinese firms.
Deals worth up to $80 billion would provide funding for investments in oil and gas infrastructure, pipelines, refineries, power, facility refurbishments and upstream sector.
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This Day Live obtained an exlusive interview from Mr Kachikwu shortly after signing contracts. He said: “I can confirm that we had a successful outing and finally raised investment commitments and signed MoUs worth $80 billion.
Out of this, $10 billion approximately was raised on the sides with our steer and push for two Nigerian companies – Delta Tek and Salvic Petroleum – while the balance of $70 billion includes MoUs signed by investors and financiers for projects with the Nigerian National Petroleum Corporation (NNPC).
Outside these (MoUs for $80 billion investments), the two largest oil companies in China, Sinopec and CNOOC, signed investment MoUs agreeing to announce after further discussions on major investment increases in the Nigerian oil and gas in the next few months.
Given the areas of focus of these two companies, we do not expect that investment to be less than $20 billion. The net effect of these and other agreements in principle reached with investor interest in China on this roadshow will potentially provide investment funds for Nigerian oil and gas of over $100 billion over the next five years.
These investments cover every facet of Nigeria’s oil and gas sector – upstream, pipelines, downstream, gas and power, modular refining in the creeks, engineering services, etc.
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It has been a fantastic outing and if we can follow through on all these, it will change the face of Nigeria’s oil and gas forever. This will bring hope even to the Niger Delta and is the single biggest amount of MoUs signed on investment in any third world country in a roadshow.”
FMPR, NNPC to work round the clock to make the investments a reality
“We will work round the clock to meet the conditions precedent to draw down and make these investments a reality. Of course, the federal government’s approval on certain commitments will be required as these involve sovereign guarantees.
But the number of projects that require sovereign guarantees are very limited, as most of them are build and operate projects such as the pipelines and refineries, which are attractive prospects for the Chinese firms that have expressed interest in coming to Nigeria.”
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The companies involved in the deal include China North Industries Corporation (NORINCO Group), China Cinda Asset Management Company Limited (CINDA), China National Offshore Oil Corporation (CNOOC), China Petroleum & Chemical Corporation/Addax petroleum (SINOPEC/ADDAX), International Chamber of Commerce/ China’s National Development and Reform Commission (ICC-NDRC), among others.
The agreement became possible due to “the minister’s 30 years experience and contacts in the oil and gas industry, as well as President Muhammadu Buhari’s leadership and support.”
The officials of NNPC and the petroleum ministry were planning the crucial meeting with 38 Chinese companies that was atteneded by more than 300 Chinese and Nigerian businessmen and investors for two months.
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Dr. Kachikwu also has several to India and the Gulf states in July and August, which are trips aimed at attracting new investors to the country.
More details at This Day Live.
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