Chevron to sell stake in Nigerian oil blocks

An international oil company operating in Nigeria, Chevron, has announced its intention to divest its stakes in two shallow water oil blocks in the country.

The company said on Tuesday the two oil blocks, OML 83 and OML 85, held an estimated 200 million barrels of oil and an unknown quantity of natural gas.

It, however, said there had been no production yet in the two blocks.

“As part of a continuous process of portfolio evaluation and business prioritisation, Chevron Nigeria Limited has put forward its interests in two oil mining leases for auction,” a spokesman of the firm said.

Chevron owns 40 per cent stake in 13 shallow water blocks with the Nigerian National Petroleum Corporation, and also has several deep offshore assets. Its 2012 net daily production in Nigeria averaged 238,000 barrels of crude oil and 165 million cubic feet of natural gas.

Chevron is the latest oil major seeking to dispose of assets in Nigeria.

Several oil majors have sold their assets onshore or in the shallow waters of the Niger Delta over the past few years.

The country suffers from widespread oil theft, and, at times, difficult relationships with local communities onshore, driving up the costs of operating there, while a long-delayed Petroleum Industry Bill is stuck in parliament, adding to industry uncertainty.

Royal Dutch Shell, Italy’s Eni and France’s Total have sold several blocks.

Buyers of these included United Kingdom-listed firms, Heritage Oil and Eland Oil. Chinese-owned Addax had recently said it was interested in buying more Nigerian assets.

Chevron’s blocks are at the exploratory stage, unlike Shell’s which are already producing fields, which will make valuations less straightforward, one banking source said.

United States firm, ConocoPhillips, is also planning to sell its Nigerian businesses to Oando Energy for about $1.79bn, the company said in December.

Oil majors, which are looking more towards deepwater offshore, say they cannot invest in large new projects until the PIB is passed.

[Punch]

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