Total sells Nigeria offshore oil stake for $2.5B

AP News
Posted: Nov 19, 2012 12:26 PM
Total sells Nigeria offshore oil stake for $2.5B

LAGOS, Nigeria (AP) — French oil company Total SA said Monday it had sold its stake in an offshore oil field near Nigeria for $2.5 billion to the Chinese state-run firm Sinopec Corp., a sign of China's growing stakes in the West African nation's oil production.

The field includes Total's deep-water Usan production operation, which opened earlier this year and has a production capacity of 180,000 barrels a day. Production had been ramping up and is currently at around 130,000 barrels a day, Total spokesman Charles-Etienne Lebatard said.

The Usan facility has a storage capacity of 2 million barrels, the company has said. The field is about 62 miles (100 kilometers) from the West African nation's southeastern coast.

Total said the sale matched its plans to raise cash for new ventures. In September, the company issued a statement saying it planned to sell $15 billion to $20 billion worth of its assets from now through 2014.

"This sale of an asset operated from a minority position will allow us to focus our resources on the material growth opportunities in Total's portfolio," Yves-Louis Darricarrère, president of upstream operations at Total, said in a statement.

Total said the deal, done for cash, must be approved by Nigerian authorities. Officials with Sinopec could not be immediately reached for comment.

The state-run Nigerian National Petroleum Corp. is the concession holder on the field. Other partners include Chevron Corp, Esso E&P Nigeria Ltd. and Nexen Petroleum Nigeria Ltd. Nigeria's state-run firm also would have final say on the sale. Fidel Pepple, a spokesman for the corporation, said the firm "was working on" a response to the announcement, but declined to immediately comment Monday.

Total is one of several foreign oil companies that operate in Nigeria, a nation that produces more than 2 million barrels of oil a day and remains key to U.S. gasoline supplies. Addax Petroleum, a subsidiary of Sinopec, already pumps crude oil from Nigeria, although it is a relatively small amount compared to other Western companies operating there.

The move by the Chinese comes after the country has increasingly offered loans and assistance to Nigeria. China is increasingly looking across Africa for raw minerals and supplies to fuel a massive economy that has slowed in recent years during the economic downturn. China also has been mentioned as a possible bidder for oil blocks in the country, though experts believe past Nigerian governments only have used the Chinese interest to force Western firms to increase their own bids.


Jon Gambrell reported from Johannesburg and can be reached at .