Nigeria's State Oil Company Seeks $4.1 Billion to Lift Output

(Bloomberg) -- Nigeria’s state-owned oil company said it’s in talks with financiers to raise as much as $4.1 billion and will seek to sign service deals to increase production from three leases.

The Nigerian National Petroleum Corp., or NNPC, is in discussions with Lagos-based Sterling Oil Exploration & Energy Production Co. to raise $3.15 billion and CMES-OMS Joint Venture Ltd. for $991.1 million, the company said in a statement. The funds will be used to develop oil leases holding more than 400 million barrels of crude reserves, which are operated by the NNPC’s Nigerian Petroleum Development Co. unit, it said.

Nigeria pumps about 1.78 million barrels of oil a day while the state oil company’s exploration and production unit averages about 240,000 barrels per day. It wants to more than double daily output to 500,000 barrels and boost daily gas production to 1.5 billion standard cubic feet by next year.

The NNPC has paid $993.7 million of outstanding cash contributions by September to joint venture partners including Royal Dutch Shell Plc, Total SA and Eni SpA, it said in the statement. The company still owes $3.95 billion in arrears.

Last year, the NNPC signed financing agreements worth $2.3 billion with joint venture partners and other third parties, it said. It has also agreed to fund gas projects with Nigeria LNG Ltd., Africa’s biggest gas liquefier, for $2 billion, the company said.

To contact the reporter on this story: Elisha Bala-Gbogbo in Abuja at ebalagbogbo@bloomberg.net

To contact the editors responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net, ;Sophie Mongalvy at smongalvy@bloomberg.net, Andre Janse van Vuuren, Chitra Somayaji

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