Exclusive: ConocoPhillips looking to exit Nigeria: sources

LONDON/ABUJA, Nigeria Tue May 8, 2012 2:18pm EDT

Smoke is released into the sky at the ConocoPhillips oil refinery in San Pedro, California March 24, 2012. REUTERS/Bret Hartman

Smoke is released into the sky at the ConocoPhillips oil refinery in San Pedro, California March 24, 2012.

Credit: Reuters/Bret Hartman

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LONDON/ABUJA, Nigeria (Reuters) - U.S. oil group ConocoPhillips (COP.N) has hired BNP Paribas (BNPP.PA) to help sell its Nigerian assets, including on-shore, off-shore oil and gas fields and a stake in its LNG Brass facility, sources familiar with the situation told Reuters.

The assets were expected to attract interest from Nigerian companies such as Conoil (CONOIL.LG) and Oando (OANDO.LG) and Asian players including China's Sinopec 000554.SZ, Indian company ONGC (ONGC.NS), and South Korean firm KNOC, the sources said on Tuesday.

They could help ConocoPhillips raise about $2.5 billion and possibly more if they were sold separately, which is the most likely route, according to the sources.

ConocoPhillips could not be reached for immediate comment.

The on-shore assets are already fully functional and are seen as the most valuable part of the operations, while the early-stage Brass project could prove more difficult to value, one of the sources said.

A Nigerian local content act passed in 2010 is likely to complicate any transaction as foreign suitors need to team up with a local indigenous player.

The government passed the law, intended to give local firms priority when assets are being sold and in tenders for new projects, and it is likely to push for local ownership of Conoco's assets.

The state-oil firm, the Nigerian National Petroleum Corporation, is the majority shareholder in Conoco's on-shore and LNG assets and is seen as less likely to be among the interested parties, the sources said.

NNPC told Reuters on Tuesday it was not aware that Conoco was exiting the country.

Nigeria is Africa's largest oil producer, pumping more than 2 million barrels per day. The OPEC member also holds the world's seventh largest gas reserves, which are largely untapped.

Shell's recent disposals of on-shore oil fields in Nigeria have attracted interest from local firms, often through partnerships with established foreign companies.

ConocoPhillips recently completed the spin-off of its refining activities into Phillips 66, a newly created independent U.S. company.

(Additional reporting by Matt Daily and Anna Driver in Houston; editing by Jason Neely)

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Comments (1)
ARH wrote:
Any suggestion/speculation as to why they are doing this? Seems contradictious to what the trend among the oil majors have been.

May 08, 2012 3:43pm EDT  --  Report as abuse
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