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CHINESE FIRM DENIES $50BN BID FOR OIL LICENCES

By NBF NEWS

The Chairman, China National Offrshore Oil Corporation, Mr. Fu Chengyu, on Wednesday, said his company was not bidding for 16 oil licences currently held by some international oil companies in Nigeria.

Chengyu denied the company was in talks to buy stakes in Nigerian oil blocks controlled or operated by western oil groups, referring to a Financial Times report in September, 2009.

The Financial Times reported last September that CNOOC had identified licences in Nigeria in which it would like to buy stakes, including 16 operated by Royal Dutch Shell, Chevron and ExxonMobil.

The Special Adviser to the President on Petroleum Matters, Dr. Emmanuel Egbogah, was quoted to have said in December, 2009, that several state-run Chinese oil firms, including CNOOC, were ready to invest $50bn to acquire those reserves in a proposal made in June.

Chengyu, who dismissed the bid, said, 'There are rumours saying that CNOOC is approaching the (Nigerian) government to get 16 concessions… worth $50bn in total. This is not what we want to do.'

Those licences would allow China to acquire six billion barrels of Nigerian oil, equivalent to one sixth of the African country's proven reserves.

Chengyu, who stated that the oil licences held by the western oil firms were not up for renewal, said, 'We will not talk about assets not in government hands. It's not that we don't have an interest. The 16 concessions are in the hands of the international oil companies, not the government.'

Egbogah had on February 3, 2010, said the Federal Government was offering an estimated two billion barrels of oil reserves in a fresh licensing round for oil blocks this year.

He was quoted by Reuters on Tuesday as saying, 'There will definitely be a bidding round this year with both onshore and offshore fields. It will be something not less than two billion barrels.'

According to him, the government has not yet finalised the number of leases that will be made available this year, but the bidding round would include licences relinquished by western players.

Egbogah, had told our correspondent exclusively last year that a new bid round was 'most likely to happen' in 2010.

It is expected that many oil blocks outside the Niger Delta basin would be put on offer in the new bidding round.

He noted that Nigeria's deepwater was still a highly prolific terrain, adding that if a prospector drilled five exploratory wells in the zone, he was likely to strike crude oil in four.

The past bid rounds held in 2005, 2006 and 2007 were fraught with complaints of irregularities.

Analysts say CNOOC, which recently bought a $3.1bn stake in Argentine Bridas Holdings, could be the most acquisitive Chinese oil company this year as it races to meet aggressive production growth targets, underscoring China's hunger for energy resources to feed the world's fastest-growing major economy.