Huge Divestment By IOCs, Opportunity For Local Investors – Alison-Madueke

International Oil Com
panies (IOCs) operating in the country may divest about N2 trilion worth of oil blocks by the end of this year, says the Petroleum Minister, Mrs Diezani Alison-Madueke.
The Minister revealed that some of the oil companies have either sold off or were in the process of selling up to 28 oil blocks since 2010.
She said the oil blocks account for about 2.2 billion barrels of crude worth about N840 billion.
The Minister who made the disclosure at the Offshore technology Conference (OTC) in Houston, Texas however allayed fears that the unfolding situation could lead to crisis in the country.
Represented at the event by the GMD of Nigeria National Petroleum Corporation, Mr. Andrew Yakubu, the Minister said the divestment in the upstream sector of the oil industry by IOCs such as Shell, Total, Agip, Chevron and Conocophilips have continued to create an opportunity for participation in the industry by Nigerian Private sector.
“The divestment campaign was highly competitive and attracted interest from a number of indigenous and foreign companies”, she said.
She noted that at the end, the total number of blocks that are likely to be divested was extimated to exceed 20 with not less than four billions of oil equivalent and a monetary value about $11.5 billion.
She, however stated that Nigeria’s oil production had remained steady at about two million barrels of global production.
She also said that gas production has increased from 2.4 billion cubic feet per day in 2009 to about 8.0 billion cubic feet per day at present, representing about 1.1 per cent of global gas production.
Alison-Madueke explained that reason for the divestment by the IOCs is that they are moving into more challenging frontiers in the deep offshore while leaving the onshore which they consider less profitable.
She also added that some of the IOCs had been sitting on oil blocks and have allowed the acreage to go fallow for years without significant development.
The Minister assured that the IOCs remain very much present in Nigeria as Shell still retains ownership of 34 onshore blocks, while Total Exxon Mobile and Chevron are still committing large amounts of capital to assets offshore Nigeria.

Generators displayed at Area One Shopping Complex, Garki, in Abuja, recently