Nigeria reimbursed oil companies including Exxon Mobil and Royal Dutch Shell $3-billion, moving closer to clearing operating expense arrears owed since 2010.
The payment is being settled through a five-year crude oil sales deal agreed in 2016, Nigerian National Petroleum Corp (NNPC) said in a statement. While a majority has been paid as of August, there’s still about $1.7-billion outstanding. Exxon has got $2.3-billion, clearing all dues. Shell has received $455-million, but is still owed $917-million.
NNPC operates joint ventures with producers including Exxon Mobil, Shell, Chevron Corp, Total and Eni that pump about 80% of Nigeria’s output. Lower revenue and demands for other payments hampered NNPC’s ability to contribute its share of expenses from 2010 to 2015, leading to the arrears.
It still owes Eni $385-million, Total $304-million and Chevron $55-million, according to the statement.
The oil majors didn’t immediately respond to requests for comments.
The Nigerian state-run company on October 15 published audited accounts for only the second time in its 43-year history. The report showed its annual loss shrank to just a few million dollars last year from about $2-billion in 2018 as it slashed costs across its operations.
The payments to the oil companies suggest NNPC may finally be turning a corner with profit and cash. That’s good news for Nigeria’s oil industry, which generates about half of all government revenue. But like oil companies around the world, NNPC is also facing weak global demand because of the coronavirus and new restrictions to contain it.