China to Invest in Nigeria’s Oil and Gas Sector

oil-and-gas-explorationThe Chinese delegation will visit Nigeria in October to discuss investment in oil and gas industry. Nigeria’s Minister of State For Petroleum, Ibe Kachikwu said on Wednesday.

In June 2016, Nigerian National Petroleum Corporation (NNPC) through a statement said it had signed an MOU. The memorandums of understanding (MOUs) worth US$80 billion with Chinese firms will cover oil and gas investment. No further details on the MOU emerged until now.

“We are having a team of over 40 Chinese delegates visiting Nigeria by the end of October,” Oil Minister Emmanuel Ibe Kachikwu told reporters today in Abuja.

“I will say we have a one year period to work on this. We expect that some investment will come earlier,” he said, when asked about the agreements signed in June.

Nigeria, an OPEC member which was until recently Africa’s biggest oil producer, relies on crude sales for about 70 percent of national income but its oil and gas infrastructure is in need of upgrades.

Nigeria’s Oil and Gas Crises

Nigeria’s four refineries are mostly out of action because of poor maintenance, forcing Nigeria to rely on expensive imported fuel for 80 percent of energy needs.

Attacks on oil and gas facilities by militants have resulted in Energy problems in Nigeria. Major attacks on oil installation have been carried out by Niger Delta Avengers, compounding Nigeria’s energy crises even more. The Federal government is currently in talks with all militant groups in Niger Delta.

Last month, the head of Nigerian Senate, Bukola Saraki said Nigeria needed to consider selling oil and other state assets to help plug a budget deficit, caused by a collapse in oil revenues that has plunged Nigeria into recession.

This latest development in the Chinese-Nigeria relations generated mixed reactions from all quarters. However, everyone welcomes economic solutions out of current recession.

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