August 17, 2020

NNPC rules out equity sale, reduces debts in JV with Shell, Chevron, others to $2bn

NNPC deductions from Federation Account rise 40.5% to N883.56bn in Q1’22

By Udeme Akpan

THE Nigerian National Petroleum Corporation (NNPC) has backpedalled from selling its equity in oil assets because of low oil prices and general poor state of the industry.

Group Managing Director, NNPC, Mallam Mele Kyari, who disclosed this in a keynote address at the 45th Anniversary Lecture of the Nigeria Association of Petroleum Explorationists (NAPE), maintained that the apex oil company is proactive bearing in mind the place of oil and gas in the next 40 to 50 years.

Similarly, the Group General Manager, Corporate Planning and Strategy, NNPC, Meyiwa Eyesan, who confirmed the development, added that the NNPC has reduced its cash call debts in the Joint Ventures (JVs) with International Oil Companies (IOCs) to  $2 billion.

According to her, the reduction in JV with Shell, ExxonMobil, Chevron, Eni and Total was achieved between 2015 and 2020 from $5 billion in 2015 to over $2 billion in five years, paying about $3 billion of the JV cash call arrears.

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Speaking at the lecture held virtually in commemoration of the first Akomeno Oteri Annual Lecture themed; “Long-term funding for E&P Business in Nigeria: Strategies and sustainability,” the Group General Manager, Corporate Planning and Strategy, NNPC, said that the corporation is not in dire need to sell off its equities in oil companies that are in partnership with NNPC.

She said: “This is the wrong time to sell our equity to any trusted partners. What we have done in the upstream sector is what we are going to replicate in the downstream by going into partnership with private investors.

“The pipelines and the refineries are open to partnership on Build Operate and Transfer (BOT) bases.”

However, other panellists who participated on the online Lecture advocated for Energy Bank as a means to properly fund the oil and gas sector.