Oil and gas fields owned by Exxon Mobil Corporation in Nigeria could soon be sold, as the U.S company is in talks with companies interested in the oil blocks.
The sales will include stakes in onshore and offshore fields.
The Texas-based company is one of the largest oil and gas producers in Nigeria, with 106 operated platforms. Selling the proposed fields could raise up to $3 billion.
Why Exxon is selling its oil and gas field: The company is looking to divest its business in Nigeria and focus on new developments in U.S shale and Guyana. This has prompted Exxon to hold talks with several Nigerian companies in order to determine their interests in the fields.
Another contributing factor is the oil spills resulting from pipeline sabotage which has compelled some international companies, including Royal Dutch Shell, to reduce their presence in the country.
The oil fields Exxon is putting on sale
The focus is on a number of onshore fields Exxon shares (in joint ventures) with Nigerian state oil firm, Nigerian National Petroleum Corporation (NNPC). These include oil mining leases 66, 68, 70 and 104.
It was reported that Exxon’s share of oil production in those fields reached 120,000 bpd in 2017, the last year for which data was available.
Exxon is also planning to offer assets in two African countries – while the company is weighing the possible sale of stakes in offshore fields in Nigeria, it is also looking into offering for sale assets in Equatorial Guinea and Chad.
Exxon divestment is not only in Africa –the company has also launched the sale of its stake in Azerbaijan’s largest oilfield, which would mark its retreat from the former Soviet state after 25 years.
Exxon’s plan in Guyana and the U.S. oilfields
The expansion drive of Exxon has seen the company announce an increase in its capital spending from $26 billion in 2018 to $30 billion in 2019 and up to $35 billion next year in a bid to develop oilfields in Guyana and the U.S.
In an analyst presentation last month, Exxon said it would accelerate its divestments to around $15 billion by 2021.
The divestment in Nigeria comes at a time the Nigerian government is encouraging the expansion of domestic firms such as Oando, Seplat and privately held Aiteo in the country.