Energy

NNPC Explains Payment Of $993.7m Cash Call Arrears

Nigeria’s state oil firm said on Friday it had paid $993.7 million up to September in arrears owed to its joint ventures with multinational oil companies by September, and still had to make up payments of $3.95 billion.

The Nigerian National Petroleum Corporation (NNPC) said it was seeking to raise about $2.3 billion in financing from third parties, such as joint venture partners, to help cover costs.

NNPC also said it was raising $3.15 billion through a firm called SEEPCO to develop 416 million barrels of reserves from the Oil Mining Licence (OML) 13 field.

NNPC has over the years piled up unpaid bills, so-called cash calls, that it was obliged to pay Western firms with which it has joint ventures for oil exploration and production.

The delay in payments has hindered oil and gas investment in the OPEC state and worsened a budget crisis as the government seeks to increase spending to boost an economy still recovering from a recession.

Minister of State for Petroleum Emmanuel Kachikwu said this month Nigeria was producing 1.78 million bpd.

In November, NNPC said it would increase oil production in 2019 to 1.8 million barrels per day (bpd). At that time it was producing roughly 1.6 million bpd.

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