Investment: Nigerian government, Chinese firm sign $8.5bn oil deal

Dr. Emmanuel Ibe Kachikwu, Nigeria's minister of state for petroleum resources.

*Dr. Emmanuel Ibe Kachikwu, Nigeria’s minister of state for petroleum resources.

Oscarline Onwuemenyi

29 June 2016, Sweetcrude, Abuja – The Federal Government yesterday signed a potential deal for $8.5 billion investment with a Chinese firm, China North Industries Group Corporation.

Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu, disclosed this after the signing of the deal in Beijing, China. The country is also seeking between $40 billion and $50 billion investment in oil projects.

He said the country had raised its crude output to as much as 1.9 million barrels a day, as of two days ago and that the country’s crude output was expected to rise to 2.2 million barrels a day next month if repairs to a pipeline are completed.

The minister told Bloomberg Television in an interview on Monday that, “We’re looking to raise about $40 to $50 billion. Going to places like China, which have a huge capacity to put money in the oil sector, is very helpful.”

Low oil prices, which have fallen by more than half in the past two years, are forcing some of the world’s largest drillers to seek investment to maintain and expand output.

Saudi Arabia’s deputy crown prince, Mohammed bin Salman, said in April that the government planned to list less than five percent of the state producer known as Saudi Aramco, which could turn the world’s biggest oil exporter into the largest publicly traded firm with a value in trillions of dollars.

Russia is seeking buyers for 19.5 percent of Rosneft PJSC.

Attacks on oil facilities by rebels earlier this year reduced Nigeria’s oil production to 1.3 million barrels from 2.2 million a day, but it had risen to between 1.8 million and 1.9 million as of two days ago, Kachikwu said, adding that crude prices may end the year between $50 and $55.

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