ExxonMobil considers sale of Nigerian assets as part of global strategy to high-grade existing portfolio

Exxon Mobil Corporation is discussing how to sell off some of its oil and gas fields in Nigeria in order to focus on US Shale and its Guyana oil fields. This was made known to Reuters by oil and gas industry and banking sources. It comes almost two and a half years after the oil giant divested from Nigeria’s downstream oil sector.

“Exxon is actively divesting in Nigeria,” one source who was briefed on the divestment plans said. However, ExxonMobil’s divestment is not about Nigeria, it is part of a larger strategy to high-grade its existing portfolio. In 2018, the American multinational oil and gas corporation completed 19 divestment transactions, including the sale of its 50 percent operating interest in the WA-1-R block offshore Australia, its interest in the Triton FPSO field cluster in the U.K. North Sea and the sale of its non-operated interest of a joint venture in Norway, among others.

The company had announced earlier this year that it plans to boost capital spending from $26 billion in 2018 to $30 billion in 2019 and up to $35 billion next year as it seeks to develop oilfields in Guyana and the U.S. Permian basin as well as gas projects in Mozambique and the U.S. Gulf Coast. But there are also developments in Nigeria on its books, including Erha, Erha North, and Usan fields.

“Preparations are under way to recommence drilling in the shallowwater blocks in 2019, which produce at a daily rate of approximately 130,000 net oil-equivalent barrels. Two rigs are under contract and mobilized,” the company said in its 2018 Financial & Operating Review.

The US-based company expects to raise $3 billion from the potential disposal of its stakes in onshore and offshore fields. The company has also been talking to several Nigerian companies to see if they are interested in acquiring their fields which will include Oil Mining Lease 66, 68, 70 and 104. According to available data, Exxon’s share of oil production in those fields reached 120,000 bpd in 2017.

The sources also revealed to Reuters that Exxon is also weighing the possible sale of its assets in Equatorial Guinea and Chad. Recently, Exxon also launched the sale of its stake in Azerbaijan’s largest oilfield, which would mark its retreat from the former Soviet state after 25 years.