Nigeria targets $4 billion Chinese investment for oil industry


Nigeria says it expects to get as much as $4 billion in investment facilities for oil industry infrastructure as a 40-member Chinese investment team arrives the country at the end of the month.

This is a fallout from the July road show in China where Nigeria signed a $75.6 billion Memorandum of Understanding in investment in the oil sector, the Minister of State for Petroleum Resources, Emmanuel Kachikwu, said after the Federal Executive Council meeting on Wednesday.

Briefing journalists alongside the Ministers of Information and Culture, Lai Mohammed; Interior, Abdurahman Danbazzau; and Power, Works and Housing, Babatunde Fashola, after the FEC meeting Mr. Kachikwu explained that the MOUs signed during the road show generally have a gestation period of about one year as both countries set up their teams on bilateral lines to look at specific areas of investment interests.

“That is still work in progress,” he said. “We are having a team of over 40 Chinese, members of some of those bodies about visiting Nigeria by the end of this month. We are also setting up a full inter-ministerial panel that will be deliberating with them for each of those sectoral investments.

“I will say that the target we had while going to China was to raise $40 billion which is the total cost of our infrastructural gap for the oil industry. We raised about $75.6 billion, $69 billion of which were NNPC and government related potential investments and loans and the rest directly to the private sector.

“If we get even 20 per cent of that, that will be a major achievement for us.

“I will say we have one year period to work on this, we expect that some will come earlier. There are some facility lines that are almost readily available, close to about $3 or $4 billion. But the investment packages will take us time.

“This is different from the pledges that were made when the President visited China which was an all African type front basis, this is completely separate,” the minister said.

The Nigerian National Petroleum Corporation, NNPC, had in July embarked on a road show to China seeking investments to bridge the infrastructure funding gaps in the Nigerian oil and gas sector.

The management of the country’s state oil company had subsequently announced the signing of MOUs with some Chinese companies worth over $50 billion for infrastructure development.

The corporation had in its statement listed companies involved in the deal to 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 council also approved the resuscitation of the National Council on Hydrocarbon, an ombudsman council that meets once a year to just review policies in the oil and gas sector.

The minister explained that the council is a gathering of people from the business, oil sector, oil communities and ministries that are directly or indirectly affected by the policies rolled out by the
petroleum ministry.

“The criticality is that as we continue the dialogue we have been having with militants, creating such a fora enables anybody who has an interest in the area, to converge and develop the thinking process that will guide policies in this sector,” he said.

He said the Council also approved the hosting of an international flare reduction convergence meeting in Nigeria billed to hold on November 30 and December 1.

“We will use that as a chance to roll out efforts by the ministry to addressing the flare. You are aware Nigeria is next to Russia in terms of the highest (gas) flaring nation. Even though we have progressed positively to reduce 70 per cent of the flare, but the 30 per cent we still flare is about 10 per cent of the world’s flare, so is a huge amount of gas,” he added.

Mr. Kachikwu said he also briefed council on the outcome of the OPEC meetings where it was agreed that output oil levels be reduced by member, except Nigeria, in order to increase price.

Iran and Libya were also excluded from the deal.


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  • Comfortkay

    Chinese investment is surely a good news BUT they should put Nigerian to work and not Chinese.

  • vagabonds in power

    Are we really serious about looking inwards to get Nigeria out of the economic recession? How serious are we in achieving the much-touted diversification of the economy? What policies do we have binding all arms and departments of government to ensure that goods that can be manufactured in Nigeria are no longer imported from foreign economies? Are government departments really adhering to the Central Bank of Nigeria (CBN’s) 41 prohibited items for the foreign exchange support of their importation? These questions arise in the face of the continued patronage of foreign manufactured goods even by governmental organs when such goods can be cheaply and efficiently procured from our local artisans and manufacturers. Worthy of particular mention is the reported importation by the military authorities of military gears, including footwear, berets, cardigans, belts, head warmers, and branded stockings from foreign markets worth 4.9 billion Naira or $14.1m (at the exchange rate of N305 per Dollar).

  • dami

    the chinese…cant help us….they lack the tech, know how and experience to know what to do in the oil and Gas industry…and they are expensive and will import millions of chinese to nigeria to do the work….you also cannot get justice in a chinese court if they rip you off.
    stay with the west – they speak english, they have been drilling for oil for donkey years (they have the tech and know the business)…they have a judicial system that you can get justice in for looters and those that rip you off.

    chinese…indians…pls stay away from them.

    • Arabakpura

      Addax is a Chinese company! China currently owns the controlling shares in USAN deep water development run by ExxonMobil’s ESSO! They have the technology to drill and complete an oil well without input from anybody else! Universal Energy Resources is a Chinese company in Nigeria and runs their own Liner Hanger Technology! Most of the indigenous Nigeria companies in the oil services sector rely on equipment from China, Singapore etc. China, just like Russia run independent and proven systems!

      • dami

        Great! you know what the shareholdings of these companies are – now take a closer look and tell me whose technology they are using to drill / explore / for their ops…when you have found out feel free to share your observations.

        Hint – there is no Chinese tech being used in these companies and that’s a fact, they all use American tech / software from haliburton / drilling know how from a schlum etc…so why go to the Chinese (who will still go to the Americans) when you can go to the Americans directly?

        • Arabakpura

          They don’t need American Technology in China but yes, in Nigeria, it is deregulated and so everybody participates! Chinese technology is proven!