The arrangement follows a settlement and exit agreement between NNPC Limited and Addax Petroleum Development (Nigeria) last November for the transfer of its four major oil mining leases (OMLs) in Nigeria to the national oil company. Following the signing of a Memorandum of Understanding (MoU) on the transfer, settlement, and exit agreement, Addax will cease to be the PSC contractor for the OMLs 123/124 and OMLs 126/137.
Meanwhile, Nigeria’s Minister of State for Petroleum Resources, H.E. Chief Timipre Sylva, announced that the NNPC Limited awarded a $741 million contract to South Korean construction company, Daewoo Engineering & Construction (E&C), for the rehabilitation of the 110,000-barrel per day Kaduna Refinery and Petrochemical facility on a sustainable basis at a minimum 60% of its nameplate capacity by the end of 2024.
Under the quick-fix repair contract, the South Korean firm will complete the restoration project in three work packages over a period of 21 months. Situated in the northern city of Kaduna, restoration of the refinery is expected to assist Nigeria in reducing its dependence on fuel imports. The contract follows a MoU signed between the NNPC Limited and Daewoo E&C in October 2022 to restore the refinery.
Having encountered approximately 200 net feet of Miocene and Oligocene gas-bearing sandstones with an estimated 3.5 trillion standard cubic feet of natural gas in the Nargis-1 Well in the Mediterranean Sea, offshore Egypt, the North African country’s Minister of Hydrocarbons, H.E. Tarek El Molla, announced that oil and gas supermajor, Chevron, and its partners are currently evaluating the commercial viability of the well. Located in the Nargis Offshore Area Concession, which was recently taken over following Chevron’s recent acquisition of hydrocarbon exploration company, Noble Energy, the discovery has the potential to allow Egypt to maximize is natural gas exports and improve its foreign exchange earnings.
With approximately half of global oil demand this year expected to come from China, oil prices inched up in early trade on 6 February following a fall of roughly 8% the previous week to more than three-week lows. Brent crude oil futures were at $80.10, up by 0.2 percent, while U.S. West Texas Intermediate crude futures were at $73.54, up by 0.2 percent.
The boosting of prices comes as a result of strong jet fuel consumption in China, as well as a price cap being placed on Russian oil products by G7 participating members, the EU, and Australia having come into effect on 5 February. Under the agreement, the G7 has imposed price caps of $100 per barrel on imports of Russian crude oil, diesel, kerosene, and gasoline, while a price cap of $45 per barrel has been imposed on Russian fuel oil. The embargo and price cap on Russian refined products has resulted in an increase of fuel oil export to Asia since 2022.