Nigeria eyes lower stakes in oil JVs in bid to spark foreign investment

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Nigeria’s oil minister says he wants to reduce the government’s stake in its joint venture businesses with foreign companies in an effort to encourage more foreign investment.

Newly appointed Minister Timipre Sylva says lowering the government’s stake to 40% from 55%-60%, raising the country’s oil production to 3M bbl/day from a little over 2M currently while curbing production costs by at least 5% are at the top of his agenda.

Nigeria, Africa’s top oil producer, owns a 55% stake in its joint venture with Royal Dutch Shell (RDS.A, RDS.B), and 60% interest in other ventures with the likes of Chevron (NYSE:CVX), Eni (NYSE:E), Exxon Mobil (NYSE:XOM) and Total (NYSE:TOT); the JVs account for ~90% of the country’s oil output.

Industry analysts say despite the minister’s lofty targets, the government needs to muster the political will to implement the programs.

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