The worth of financing transactions in the oil and gas sector that are currently being negotiated, processed and at approval stages by the Nigerian National Petroleum Corporation is $15bn.
It was also learnt that within the last four years, the corporation raised about $4bn to meet its cash call obligations for selected joint venture projects.
A report by the oil firm on some of its activities in the first quarter of 2019, which was obtained from the corporation’s headquarters in Abuja on Friday, stated that “currently, several financing transactions worth over $15bn, are at various levels of negotiations, processing and approvals.
“These financing transactions are subjected to very strict due diligence in line with global best practices and have successfully scaled such independent assessments.”
Although the report does not state the transactions, gathered that the NNPC’s recent signing of third party financing deals with international and domestic financial institutions for the development of new oil and gas projects was part of the transactions being undertaken by the oil firm.
The corporation’s Group Managing Director, Maikanti Baru, had stated that evolving new funding mechanisms for joint venture operations was part of the focus of the reforms undertaken by the government to eliminate the often difficult cash call regime, enhance efficiency of the management of oil and gas resources and guarantee growth.
He observed that to encourage the existing players in the industry, particularly the traditional JV partners, “we undertook to settle all outstanding cash call arrears amounting to a negotiated sum of a little over $5bn
Baru added, “This has restored confidence in the Nigeria oil and gas industry. We have signed third party financing deals with several international and local banks on new oil and gas developments worth over $3bn despite the depression in 2016/201 7. This demonstrates the faith in our industry and the potential we can unlock.”
The first quarter publication states that the oil firm’s access to foreign credit facilities is bolstered by its zero default record in over a decade of sourcing funds from third parties.
It further states that Nigeria’s aspiration of unlocking over 10 billion barrels of deep water oil reserves is accentuated by the signing of the Heads of Terms agreement during the review period.
The NNPC said the agreement was signed among the corporation and its production sharing contracting partners for the Bonga Main and Bonga South-West fields in Oil Mining Licence 118.
Parties in the deal include the NNPC, Shell Nigeria Exploration Production Company, ExxonMobil Nigeria, Total Exploration and Production Nigeria and Nigeria Agip Oil Company.
The Bonga South-West Deep project is operated by SNEPCo with Esso Exploration and Production Nigeria Limited, Total E&P Nigeria Limited, and Nigerian Agip Oil Exploration Limited as co-ventures.
The NNPC also noted in the latest publication that the quantum of its financing from local and international financial markets had grown astronomically in both frequency and value.