Exclusive: US Oil Major ConocoPhillips to quit Nigeria
The US oil major, ConocoPhillips has hired BNP Paribas (BNPP.PA) to help sell its Nigerian assets, including on-shore, off-shore oil and gas fields and a stake in its LNG Brass facility, sources familiar with the situation told Huhuonline.com. The state-owned
Nigerian National Petroleum Corporation (NNPC), is the majority shareholder in Conoco's on-shore and LNG assets and is seen as less likely to be among the interested parties, the sources said.
The assets, Huhuonline.com understands have attracted interest from Nigerian companies such as Conoil and Oando as well as other Asian companies including China's Sinopec; Indian ONGC and South Korean KNOC. The move by ConocoPhillips comes as the Federal Government finalizes the long-awaited Petroleum Industry Bill (PIB) that would significantly raise the taxes of the oil majors as oil companies will henceforth pay 50% tax on a percentage of their chargeable profits for onshore and shallow water areas and 20% for frontier acreage and deep water areas
ConocoPhillips intends to unbundle its assets and sell them separately and the company will probably raise about $2.5 billion and possibly more if they were sold separately. The on-shore assets are already fully functional and are seen as the most valuable part of the operations, while the early-stage Brass project could prove more difficult to value, an Oil industry source told Huhuonline.com. ConocoPhillips could not be reached for immediate comment.
Aso Rock sources told Huhuonline.com that President Goodluck Jonathan is keeping a close eye on the recent development and has personally instructed Oil Minister Diezani Allison-Madueke to ensure that the Nigerian local content act passed in 2010 is scrupulously respected to the letter. The law was passed ostensibly to give local firms priority when assets are being sold and in tenders for new projects, and it is likely going to complicate any transaction as foreign investors must seek a local indigenous partner.
Shell's recent disposals of on-shore oil fields in Nigeria have attracted interest from local firms, often through partnerships with established foreign companies. ConocoPhillips recently completed the spin-off of its refining activities into Phillips 66, a newly created independent US company.
An NNPC spokesperson told Huhuonline.com that the NNPC was not aware that ConocoPhillips was quitting Nigeria; Africa's largest oil producer, with more than 2 million barrels per day. Nigeria also holds the world's seventh largest gas reserves, which are largely untapped.