Nigeria | International Oil Companies Support Fuel Imports with US$200 Million

LAGOS, Nigeria, Capital Markets in Africa — International oil companies in Nigeria have agreed to provide about US$200 million to support fuel imports and end shortages, Emmanuel Kachikwu, Petroleum Minister of State said.

“I have been able to convince the upstream oil companies to provide foreign exchange buffers over the next one year for those who’re bringing in products,” Kachikwu said in video posted on his Facebook page on Thursday. “So we have tied Total upstream to Total downstream, Mobil upstream to Mobil downstream, Agip/Eni to Oando, Shell to Conoil.”

Companies importing fuel in Nigeria have been hindered by lack of access to foreign exchange following the plunge in the price of oil, the country’s main foreign income earner. This has resulted in widespread shortages across the country of about 180 million, which is Africa’s biggest oil exporter, with state-owned Nigerian National Petroleum Corp., or NNPC, unable to fill the supply gap, Kachikwu stated.

Nigeria imports about 70 percent of its refined-fuel needs, after decades of poor maintenance and mismanagement left four state-owned refineries working at a fraction of their 445,000 barrels per day capacity.

Royal Dutch Shell Plc, Chevron Corp., Exxon Mobil Corp., Total SA and Eni SpAruns joint ventures with the NNPC that pump about 80 percent of Nigeria’s crude.