| Submit your comments on this article | |
| Africa Subsaharan | |
| China seeks big stake in Nigerian oil | |
| 2009-09-29 | |
The attempt could pitch the Chinese into competition with western oil groups, including Shell, Chevron, Total and ExxonMobil, which partly or wholly control and operate the 23 blocks under discussion. Sixteen licences are up for renewal. CNOOC, one of China’s three energy majors, is trying to buy 6bn barrels of oil, equivalent to one in every six barrels of the proven reserves in Nigeria, sub-Saharan Africa’s biggest crude producer and a major supplier to the US. Details of the talks were revealed in a letter from the office of Umaru Yar’Adua, Nigeria’s president, to Sunrise, CNOOC’s representative, a copy of which was obtained by the Financial Times. The overall value of the Chinese offer is not disclosed, although some details suggest a figure of about $30bn. Some oil sector executives said the total on the table was $50bn. A spokesman for Mr Yar’Adua said: “Negotiations are ongoing not only with Sunrise/CNOOC but also with all other stakeholders in the industry. The federal government has not taken any final position on the issue.” The fate of NigComSat-1 has been emblematic of China’s recent dealings with Nigeria Last November, 18 months after its launch, the controllers of Nigeria’s $257m Chinese-built satellite switched it off after a faulty power supply meant it risked colliding with other objects in orbit. It was a public relations disaster for China at a time when it seemed to be stumbling in its efforts to gain a strategic foothold in Africa’s biggest energy producer. In 2006, towards the end of the presidency of Olusegun Obasanjo, Chinese companies won four oil-drilling licences in exchange for pledges to build a hydroelectric power plant, a railway and a refinery. Oil-for-infrastructure deals have flourished elsewhere for China, notably in Angola. In Nigeria they faltered, as Umaru Yar’Adua, the new president, ordered investigations into the pacts. The projects stopped before they had started. There are 20,000 Chinese expatriates living in Nigeria, according to official estimates, and Chinese products have made inroads into the country’s teeming markets. But until now the big state-to-state deals that have typically paved the way for China’s entry into other resource rich African markets have mostly run aground. The letter, dated August 13, said an initial offer was “unacceptable” but added: “Your interest in all the listed blocks will be considered if your revised offer is favourable.” Details of how the Nigerian government would allocate equity in the blocks to CNOOC have yet to emerge and it is unclear whether this would involve forcing western groups to relinquish stakes. | |
| Posted by:lotp |