Nigeria today accounts for $48.04 billion (over 24.8%) out of about $194 billion surge in the Capital Expenditure coming into upcoming oil and gas development on the African continent from 2018 to 2025, Group Managing Director of Nigeria National Petroleum Corporation (NNPC) Dr. Maikanti Baru, said yesterday. Speaking when he declared open the 2019 Nigeria Oil and Gas Conference and Exhibition (NOG) in Abuja, Baru said Nigeria currently remained the leading Oil and Gas producer in Africa and that the nation’s energy outlook appears very positive despite the difficult operating and economic headwinds across the continent.
He said the corporation has undertaken several initiatives to broaden the base of investment sources outside traditional government funding.
“To encourage the existing players in the industry particularly the traditional JV partners, NNPC undertook to settle all outstanding cash call arrears amounting to $5 billion in 2015. Till date, we have defrayed over $2 billion. All these efforts are geared towards sustaining investment and renewing investor confidence,” he said.
In the last three years, Baru said NNPC was very active in the capital market accessing financing for different projects that have sustained the industry momentum. NNPC, he said, has created a platform in the Oil and Gas sector to explore a vast range of investment opportunities which span the value chain broadly including mergers and acquisition, pseudo equity type transactions, provision of drilling rigs and related services, heavy equipment leasing, seismic acquisition and processing, reservoir engineering and field development studies as well as core engineering services.
“We are looking at Investment in development and operation of gas processing facilities, pipeline design and construction, refineries rehabilitation, collocated refineries, introduction of condensate refineries, as well as Engineering Design and Associated Services,” Baru said.
He said between 2015 and 2017, the corporation was involved in various project financings of over $3 billion in new investment capital. “These include: The $1.2 billion multi-year drilling financing package from 2015 to 2018 for 23 onshore and 13 offshore wells on OMLs 49, 90 and 95 under the NNPC/Chevron JV, termed: Project Cheetah; NNPC/SPDC JV ($1 billion) – Project Santolina; NNPC/CNL JV ($780 million) – Project Falcon; and NNPC/First E and P JV and Schlumberger ($700 million).” Baru said, NNPC has this year significantly progressed new third party financings for the NNPC/Shell JV and NNPC/Mobil JV. According to him, both transactions were substantially over-subscribed.
“NNPC/SPDC Santolina III Project has an estimated cost of circa $500 million and NNPC/MPN Satellite Field Development II Project has an estimated cost of $1.3 billion (NNPC to raise circa $700 million in third party financing),” he stated.
