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ExxonMobil’s activities decline by 53 per cent due to cash call default - Official

By News Express on 17/09/2015

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Mobil Producing Nigeria Unlimited (MPNU), operator of MPN/NNPC Joint Venture, says its operations have witnessed 53 per cent decline because of failure of partners to honour cash call obligations.

The Manager, Field Law Services, ExxonMobil, Mr. Omojuwa Oteri, disclosed this in Uyo on Wednesday at a stakeholders meeting tagged: ‘2015 Energy Outlook Series.’

He said that the company started experiencing decline in its production activities 10 years ago due to non-release of 60 per cent cash call arrears by the joint venture partners.

“Our joint venture production over the last 10 years had been declining up to about 53 per cent.

“This is majorly because of our joint venture partner’s failure in several instances to honour their cash call obligations to the business.”

He said that the Federal Government, which is represented by NNPC, was contributing 60 per cent to the joint venture while ExxonMobil paid the balance of 40 per cent.

Oteri noted that the failure of partners to pay obligations to the joint venture had impacted negatively on investments outlook and profitability of the business.

“In addition to this problem, we now find a global trend where the price of oil is right now close to 40 dollars per barrel.

“This affects profitability of our business and outlook for investment.”

He said that ExxonMobil was suffering from difficult times due to falling oil prices and non-payment of cash call obligations from partners.

Oteri then solicited for the understanding and cooperation of business community, host communities, government and other stakeholders.

In her presentation on ExxonMobil Energy Projection for the year 2040, the General Manager, Estate and Facilities, Mrs. Elizabeth Essien, said the investment in natural gas was the way forward.

She said that the company was investing in researches to discover unconventional ways of having cheaper, reliable and affordable usage of gas.

Essien said that the company had initiated several gas processing projects aimed at reducing gas flaring.

She said that the company was planning 533 megawatt gas fired independent power plant (IPP) for Akwa Ibom, which would come on stream by 2017.

“When this project kicks off it will channel large quantity of gas from our production areas into generating electricity to feed the national grid.” (NAN)

Source News Express

Posted 17/09/2015 05:03:42 AM

 

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