Nigeria’s Minster of Budget, Udo Udoma disclosed that the country intends to cut its stake in joint oil ventures with multinational oil companies to 40% this year. This will assist the oil-rich country to boost revenue and grow its economy which is recovering from recession.
Oil companies including Royal Dutch Shell, Chevron and Exxon Mobil Corp., operate in Nigeria through joint ventures with the state-owned NNPC.
NNPC owns 55% stake in its joint venture with Shell and 60% stakes with others. The government has considered reducing its majority stakes in these joint ventures for more than a decade but was under little pressure as higher oil prices boosted state coffers.
Budgets under Muhammadu Buhari, who starts a second term in May, have been Nigeria’s largest ever and the government has been seeking to boost revenue after it emerged from a 2016 recession two years ago.
Udoma submitted that the government will intensify efforts to improve its finances including the “immediate commencement of the restructuring of the joint venture oil assets so as to reduce government shareholding to 40 percent.”
The Budget Minister added that during a presentation to lawmakers, President Mohammadu Buhari wanted the oil restructuring completed in 2019.