The Federal Government yesterday, sealed a $15 billion deal with India, wherein the latter would make upfront payment for crude oil purchases from Nigeria.
Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, while cementing the deal on behalf of Nigeria, explained that the terms of the deal would be agreed in due course.
Under the deal, Kachikwu disclosed that the Indian government would make an upfront payment for crude purchase to Nigeria, to be repaid on the basis of firm Term Crude Contracts over some years and in consideration for Indian public sector companies collaborating in the refining sector as well as exploration and production activities on a government-to-government basis by Indian PSU companies, long term contracts for supply of crude to Indian PSU companies from Nigeria and also possibilities of executing CGD and LPG infrastructure projects by Indian PSU companies in Nigeria. The Minister, who is currently on a three-day visit to India, concluded talks on the investments in Nigeria’s oil and gas sector in a bilateral meeting with his Indian counterpart in charge of Petroleum and natural gas, Shri Dharmendra Pradhan.
Both ministers noted the existing and significant engagement between the two countries in the hydrocarbon sector, while acknowledging that Nigeria was one of the largest trading partners of India in Africa which is dominated by import of crude oil and gas from Nigeria.
Between 2015-16, India imported nearly 23.7 Million Metric Tonnes (MMT) of crude (nearly 12 percent of India overall imports) and over 2 MMTPA of Liquefied Natural Gas (LNG) from Nigeria.
Following the negotiation, the two countries agreed to work on a Memorandum of Understanding to facilitate investments by India in the Nigerian oil and gas sector and specifically in areas such as term contract, participation of Indian companies in the refining sector, oil and gas marketing, upstream ventures, the development of gas infrastructure and in the training of oil and gas personnel in Nigeria.
The MoU is expected to be firmed up in December 2016 during PETROTECH-2016.
The two inisters also agreed to strengthen the existing cooperation in oil and gas sector, and in particular to explore investment opportunities for Indian public and private sector companies in Nigeria.
On the sidelines of the official visit, Kachikwu, equally had one-on-one meetings with top executives of Indian public sector oil and gas companies and also representatives of some Indian private sector oil and gas companies.