Sunday, September 25, 2011

Shell Nigeria oil sales to end with operator deal

23 September 2011

* Buyers, NNPC likely to reach operator compromise

* NNPC to "operate" but sub-contract - sources

* Stalled reforms holding back investment

By Joe Brock

ABUJA, Sept 23 (Reuters) - Shell's (RDSa.L) Nigerian oil block sales are heading for a messy conclusion due to a tussle over who operates the fields, sources close to the deals said, highlighting the complex nature of doing business in Africa's largest energy industry.

Shell along with foreign oil major partners Total and Eni have agreed to sell their share in four onshore oil blocks which Shell operates in the Niger Delta wetlands but they need ministerial approval.

Deals for the blocks, one of which attracted a bid of over $1 billion, have already been agreed and a 10 percent deposit paid. These payments triggered a 180-day window for the deals to be completed, the first of which expires at the end of this month, according to sources involved.

State-oil firm NNPC, which owns the majority stake in the blocks, is at loggerheads with the buyers because it says its subsidiary will take over from Shell as operator of the fields once the deals are completed.

But some buyers of the blocks are not willing to complete the deals if NNPC is the operator.

No comments:

Post a Comment