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Nigeria's NNPC says it paid debts owed to Mobil Producing Nigeria

Published 03/07/2019, 21:06
Updated 03/07/2019, 21:10
Nigeria's NNPC says it paid debts owed to Mobil Producing Nigeria

LAGOS, July 3 (Reuters) - Nigerian state oil company NNPC on
Wednesday said it had fully settled its debts to ExxonMobil's
local subsidiary with a payment of $833.57 million.
NNPC said the money to Mobil Producing Nigeria (MPN) settled
long-standing debts owed via "cash calls," or costs that it is
obligated to pay to joint-venture partners in oil and gas
exploration and production.
As of late last year, NNPC said it still had to make up
payments of $3.95 billion to oil companies as part of the cash
call debt. The outgoing head of NNPC, Maikanti Baru, said the debt had
been paid with incremental production, and "would invariably
lead to an increase in revenue to the government."
In June, ratings agency Fitch said the cash call backlog
clearance was constraining Nigeria's budget receipts from oil
and gas extraction. The debts to Mobil and other producers have also curtailed
investments in the sector.
NNPC said it had also signed an agreement with the company
for pre-production costs of just over $1 billion for developing
Oil Mining License 130 and Oil Prospecting Licence 222.

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