OIL COMPANIES WANT PSC ARRANGEMENT FOR JV OPERATION

The long-standing inability of the government-owned Nigerian National Petroleum Corporation (NNPC) to fund its own share of joint venture (JV) projects with oil companies has prompted calls for an arrangement, similar to what obtains in production-sharing contracts for JV projects, to address the funding problem.

This is as NNPC’s inability to fulfil its financial obligation is affecting the activities of the partners and taking a toll on local contractors, as projects are being held up.

Nigeria’s oil and gas production structure is mainly split between JV with NNPC onshore and in shallow water, and production sharing contracts (PSC) in deepwater offshore.

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