Nigeria's NNPC doubles crude exports to China's Sinopec
Source: MarketWatch.com
BEIJING (MarketWatch) -- Nigerian National Petroleum Corp. signed an agreement with China Petrochemical Corp., or Sinopec Group, to double its crude oil exports to 100,000 barrels a day, said a Sinopec executive Friday.
The year-long agreement, signed in August between Nigeria's state-owned oil company and its counterpart in China will take effect from October, the executive said.
NNPC also renewed its crude oil exports agreement with China National Petroleum Corp. (CNPC.YY), which is China's largest oil producer by output, for shipments of 30,000 b/d, said an executive from CNPC.
The combined crude cargo exports from Nigeria to China's two biggest oil companies will be 130,000 b/d - up from last year's 80,000 b/d. Neither of the executives disclosed the value of the contracts.
The deals come as China seeks a closer relationship with resource-rich African nations including Nigeria and Angola, to reduce its dependence on oil imports from the instability-prone Middle East.
Chinese oil titans have been purchasing crude cargoes and acquiring assets from Nigeria in past years. CNPC secured four oil blocks in Nigeria earlier this year in a deal that also saw it agree to invest $2 billion in the NNPC-owned Kaduna refinery there.
Sinopec has stakes in three oil blocks in Nigeria. Two blocks haven't started production, while one of the blocks has been producing 4,000 barrels of crude a day.
China National Offshore Oil Corp. or CNOOC, the country's third-largest oil producer, is also active in exploration and production in Nigeria.
In March, CNOOC bought a 35% working interest in a license to explore for oil offshore Nigeria for $60 million. It is also in talks to secure right of first refusal on at least two more oil blocks to be offered in an international tender by Nigeria and an agreement is expected to be signed in November.
Nigerian crude is a high-quality light, low sulfur grade referred to as sweet, and is highly prized by oil consuming nations because of its high gasoline content and relatively cheap processing costs.
-Edited by Jarrett Banks
