Chinese investments in Nigerian oil hit $16b
Chinese investments in the oil and gas industry of Nigeria have reached US$16 billion, according to a senior NNPC official, but the industry needs even more to advance its production growth agenda.
Vanguard quotes NNPC’s Group Managing Director Malla Mele Kyari as saying “To have investment of $16bn in Nigeria is clearly an indication of your confidence in us. We have a target to grow production to 3m barrels per day by 2023, to do that, we need partners like you. You can count on us because we have common interest.”
The comments were addressed to the management of CNOOC, the third-largest state oil major in China and a company focused on overseas investments. These have become essential for China as domestic production declines due to natural depletion and challenges surrounding the development of new reservoirs, including shale plays.
Nigeria is a natural focus for investments despite problems with militant groups that have in the past few years caused several force majeure closures of pipelines and export terminals.
Earlier this year, Nigeria’s oil operations were disrupted several times due to fires, shutdowns, force majeure, and protests. In April and May, a key oil pipeline and a logistics base in Nigeria’s oil-rich Niger Delta were rocked by a shutdown and protests in the latest incident that disrupted the Nigerian oil industry.
Shell declared a force majeure on Bonny Light exports, while exports of Amenam, operated by France’s Total, were also under force majeure in April.
Nigeria is one of OPEC’s largest producers, with the June average at 1.855 million bpd, according to the secondary sources that OPEC uses for its monthly oil market updates. The country was against the OPEC production cuts agreed last December because it needed to recover its production after a truce agreed with some militant groups in the Niger Delta. Eventually, however, it agreed to join the cuts.