- Language: English
- Published: June 2011
- Region: Global
Country Report Niger
- Published: November 2013
- Region: Niger
- 24 Pages
- The Economist Intelligence Unit
The Nigerien government has awarded China National Petroleum Corporation (CNPC) a second oil exploitation permit for acreage in the Agadem block in eastern Niger.
CNPC-the only oil producer in Niger-started pumping oil from the Agadem block in November 2011, producing nearly 12,500 barrels/day in 2012. Output rose to 16,500 b/d in the first half of 2013, and the government said that the new permit covers 59 wells and an estimated 1bn barrels of oil and will allow production to be ramped up to between 60,000 and 80,000 b/d, although it failed to specify the timeframe. Previously, Niger has said that it aims to produce 80,000 b/d by 2014, but this appears unlikely. So far, output has been below the government's expectations, and the country's ability to export such volumes is in doubt. Roads in eastern Niger are poor, and difficulties reaching world markets are likely to moderate production growth. Eventually, CNPC and the Nigerien state-which is a minority partner in the Agadem block-plan to export via a yet to be built pipeline connecting the field to the existing Chad‑Cameroon pipeline. However, the financing and timeline of this project remain uncertain. The authorities have also said that they are planning a study into the feasibility of exports via a pipeline to neighbouring Benin.
The granting of a permit to CNPC reflects China's rising involvement in the country. The authorisation followed shortly after CNPC announced that it would invest US$200m in roads connecting Niger to Chad. Moreover, in late October the Nigerien government said that it had obtained a US$1bn concessional loan from the Export‑Import Bank of China, which would be repaid over 25 years with an eight‑year grace period (the allocation of the funds is not yet clear). The speaker of parliament, Hama Amadou, said that the loan would be repaid with funds from Niger's share in the Agadem block, although the government denied this. The credit line will have to be approved by parliament, but Niger is keen to reduce its reliance on France, traditionally the main ally of and investor in the country. Among other things, Chinese funds have already financed a major hospital in Niamey, the capital, and Chinese investors have constructed the country's oil refinery in Zinder, in the south‑east, and developed a uranium mine in the northern Agadez region. As the government seeks fresh financing for its ambitious public investment programme, China's importance is set to grow further. SHOW LESS READ MORE >
Country Report Niger
CNPC awarded second exploitation permit
Impact on the forecast