Nigeria is in talks with oil majors and banks to raise more capital to expand its drilling and repay $4 billion debt that has accrued over the years from previous mismanagement, the head of Nigeria’s state oil firm told Reuters.
Currently the OPEC member pumps 2.3 million barrels per day but Nigeria is looking into improving petroleum production up to 2.5 million barrels per day by the end of 2016.
The Nigerian National Petroleum Corporation (NNPC) has been cash-strapped for years and reported a loss of 267.14 billion Naira ($1.34 billion) for 2015.
We are looking at cash call funding in line of about a billion to enable us to consistently work the fields.
“Under that concept, if it works and like I said, we are still working on it so lets not talk too much about it but if it works we will have a massive increase in volumes from those fields. We are looking at about one hundred and fifty, two hundred barrels from the current 40 – 50 barrels and then we are looking at like I said, an entry fee of maybe 1 billion, 1.3 billion and then we are looking at cash call funding in line of about a billion to enable us to consistently work the fields,” said Emmanuel Ibe Kachikwu, Nigerian oil minister.
The NNPC is banking on joint ventures with local firms to boost productivity but this will have to wait until the petroleum industry bill is passed which has held up the growth of the industry for a long time.
“The ideal will be to bring in third party capital, do a joint investment slash management of the refineries and work out the process of payout over a period of 5 to 6 years through basically lifting of the finished sum portions of the finished products by the individual who has invested,” said Kachikwu.
NNPC is also to restructure its strategic alliance agreement held by Atlantic Energy to manage oil blocks that were sold in 2011 by oil giants Royal Dutch Shell.