* Nigeria is Africa's top oil exporter
* Companies need attractive terms to invest - Kyari
* Oil majors are cutting spending worldwide
* NNPC seeking $2 bln in pre-finance for Warri, Kaduna
refineries
By Libby George
LAGOS, Feb 5 (Reuters) - Nigeria's state oil company is
renegotiating commercial contract terms with major oil firms,
its chief told Reuters, in a move that it hopes will keep
investment flowing into a sector crucial for its economy at a
time when spending is being slashed.
Africa's largest oil exporter and biggest economy relies on
the oil sector for half of its budget and 90% of its foreign
exchange. It wants to raise revenue but also attract investment.
Oil companies meanwhile, including Royal Dutch Shell,
ExxonMobil, Total and Eni, are cutting billions in spending
after taking hits to their profits, shifting money to renewable
fuels and focusing only on the most cost-effective
markets.
Mele Kyari, group managing director of the Nigerian National
Petroleum Corporation (NNPC), said in an interview on Friday
that new commercial terms were being negotiated and would be
finalised before a pending oil overhaul bill is passed.
"No company will invest where they cannot get the
appropriate margin," Kyari said in a video interview, declining
to say specifically what was being renegotiated.
"We're very conscious of the fact that people have choices,
companies will make choices to leave countries when they have
to."
Nigeria's parliament has promised to pass the long-awaited
oil overhaul bill by May. It will define the sector for decades
to come, but companies have criticized the draft for not doing
enough to attract development dollars. They have raised issues
over taxation, royalties and local community
obligations.
Kyari said companies would have the option of the newly
negotiated commercial terms or moving to the updated terms
outlined under the new law.
By the end of June the NNPC is planning to have found $2
billion of financing to overhaul its Warri and Kaduna
refineries, Kyari said. Talks are underway on financing repairs
to the Port Harcourt refinery after a pre-finance bid for more
than $1 billion was oversubscribed, he said. The money will be repaid in profits and fuel cargoes from
the refineries, rather than in oil cargoes, Kyari said.
While the refineries have not operated at full capacity for
years, NNPC had to shut all of them completely last year as they
await much-needed maintenance, repair and upgrades, leaving it
with a hefty fuel import bill.