Chevron affirms withdrawal from OKLNG, divests 22.74% equity

Chevron28 August 2013, Sweetcrude, Lagos – Chevron Nigeria Limited, CNL, operator of the NNPC/Chevron Joint Venture, has affirmed that it has withdrawn from the Olokola LNG Project, OKLNG, effective July 31, 2013.

Efforts over the last eight years to mature the project have not resulted in a final investment decision, a statement by the international oil company said. The Chairman, Managing Director of CNL explained that “the business decision to withdraw from OKLNG is based on a review of our investment portfolio, the lack of progress on the project and a reprioritization of resources to focus on growing domestic gas supply,” the statement added.

This confirms last week’s story by SweetcrudeReports, which also appeared in its latest edition in The Guardian of today (Wednesday 28 August 2013) to the effect that the withdrawal of Chevron and co-multinational, Shell, from the Olokola LNG project “was specifically a result of government’s inability to progress discussions on the project.”

SweetcrudeReports also reported that the development “signposts a growing lack of confidence in the government’s commitment to the project and policy management in the (oil) industry”.

The OKLNG project company was formed in 2007 by the Nigerian National Petroleum Corporation, NNPC, Chevron, Shell and BG Group. BG withdrew from the project in June 2012 while Shell, as Chevron, pulled out of the project last month.

According to the Chevron statement, NNPC was duly informed of the decision to withdraw and the divestment process is being managed in accordance with the provisions of the Shareholders’ Agreement governing the project.

Chevron originally had 19.5% equity in the project, but this increased to 22.74% after the BG withdrawal.

Chevron said ‘it remains fully committed to Nigeria and continues to pursue its investments in the country’s oil and gas industry”.

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