China to build refineries in Nigeria

Chinese flag

China and Nigeria have agreed on a cooperation to invest at most $23 billion to build three refineries and a petrochemical complex in the African country.

Emmanuel Egbogah, special adviser to Nigerian president on petroleum matters, revealed that China State Construction Engrg. Corporation (CSCEC) signed the memorandum of understanding on May 13.

The project will be funded by Bank of China and other State-owned banks.

The localities will be the cities of Lagos, Kogi and Bayelsa, with other cities yet to be fixed. Under the deal, the refineries will be completed within five years with a daily capacity of 750,000 barrels.

Officials said some critical details remain unsettled, such as the financial terms of the deal and who will operate the plants.

Nigeria, the world's eighth-largest oil exporter and first in the African continent, has been for many years, importing refined oil to meet local demand. The Nigerian government has highlighted that foreign companies interested in carrying out investments in the country should first, give priority to infrastructure and economy before benefiting from oil and gas exports.

Bank of China

Nigeria's four refineries, with total capacity of 445,000 barrels per day, are using less than 30 percent of their installed capacity, according to official figures.

Currently, China's drilling rights in the African country are limited. Statistics from China Customs shows that in 2009, China imported 28,000 barrels of crude oil a day from Nigeria.


Source: Global Times [17 May, 2010]