Infrastructure agreements in oil and gas worth $80 billion has been signed between Nigeria and a number of Chinese companies, in efforts geared at developing the West African country.
Nigeria, an OPEC member which was until recently Africa’s biggest oil producer, relies on crude sales for around 70 percent of her national income even as her oil and gas infrastructure is in need of updating.
The country’s four refineries have never reached full production capacity because of poor maintenance, causing it to rely on imported fuel for 80 percent of her energy needs.
These problems have been exacerbated by a series of attacks on oil and gas facilities by militants in the southern Niger Delta energy hub which pushed production down to a very low margin in the last few weeks.
Oil minister Emmanuel Ibe Kachikwu, who also heads the Nigerian National Petroleum Corporation (NNPC), has been in China since Sunday for a roadshow aimed at raising investment.
“Memorandum of understandings (MoUs) worth over $80 billion to be spent on investments in oil and gas infrastructure, pipelines, refineries, power, facility refurbishments and upstream have been signed with Chinese companies,” said NNPC in a statement.
NNPC added that the China roadshow was “the first of many investor roadshows intended for the raising funds” to support the country’s oil and gas infrastructure development plans.
Earlier this week, NNPC said oil production had in the last few days risen by around 300,000 barrels per day (bpd) to 1.9 million bpd, due to repairs and no attacks having been carried out since June 16.
In a report published on Wednesday, Goldman Sachs said a “normalization” in Nigerian oil production would put pressure on global oil prices and may mean prices will average less than $50 a barrel during the second half of 2016.