The Federal Government plans to cut its stakes in joint oil ventures with international oil companies to 40 per cent this year, the Minister of Budget and National Planning, Senator Udo Udoma, has said.
The government is pushing ahead with efforts to boost revenue to grow an economy recovering from a recession.
The President Muhammadu Buhari-led administration had in its Economic Recovery and Growth Plan released in 2017, said it would reduce its stakes in JV oil assets, refineries and other downstream subsidiaries such as pipelines and depots.
Oil companies including Royal Dutch Shell, Chevron and ExxonMobil, operate in Nigeria through JVs with the Nigerian National Petroleum Corporation.
The NNPC owns 55 per cent stake in its JV with Shell and 60 per cent stakes with others.
The government has considered reducing its majority stakes in these joint ventures for more than a decade but was under little pressure as higher oil prices boosted state coffers.
Udoma was quoted by Reuters as saying in a statement that the government would intensify efforts to improve its finances including the “immediate commencement of the restructuring of the joint venture oil assets so as to reduce government shareholding to 40 per cent.”
He added during a presentation to lawmakers that Buhari wanted the oil restructuring completed this year.
In 2017, the debt office said the government wanted to raise N710bn ($2.32bn) via restructuring of its equity in JV oil assets and that it had captured the proposals in the 2018 budget.
In the past, Nigeria had held talks with oil companies regarding financing agreements for JVs after it struggled to fund its portion of such partnerships through cash calls, which had often been delayed in parliament.
The government has asked the Department of Petroleum Resources to collect past-due oil license charges and royalties, within three months.
The country has also ordered oil majors to pay nearly $20bn in taxes it says are owed to states.
Buhari has presented an N8.83tn budget for 2019, laying out plans to drive growth. He has directed the NNPC to take measures to achieve the targeted oil production of 2.3 million barrels per day this year, Udoma said.
The NNPC said on Wednesday that the oil industry would achieve the 2.3 million bpd target for the 2019 budget, adding that measures had been taken to attain it.
In his presentation to the Senate Committee on Finance on the 2019-2021 Medium Term Expenditure Framework, the Group Managing Director, NNPC, Dr Maikanti Baru, stated that with improved security in oil-bearing communities as a result of sustainable community partnership, the industry was confident of attaining the production target.