The Federal Government is considering selling some of its stakes in oil joint ventures (JV) to raise about $3 billion (about N1 trillion) in order to reduce the deficit for the 2018 budget, Daily Trust reports.
The proposed 2018 budget of N8.6trillion has about a N3.3trillion deficit, according to the details of the 2018-2020 Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP). The asset sales proposal is contained in the FG’s Economic Recovery and Growth Plan, released by the Ministry of Budget and National Planning. It said that the government’s stakes in its oil and non-oil assets are to be significantly reduced.
Government sources have confirmed that the Federal Government is considering the idea as the most feasible option to reduce its financial burden given the need for urgent development of infrastructure. The sources added that the government for now has ruled out selling the nation’s refineries but has opted to reduce its stake in JVs with international oil companies.
The Nigerian government through the Nigerian National Petroleum Corporation (NNPC) operates seven joint venture partnerships with Shell (55:45 per cent) and 60:40 per cent with Mobil, Chevron, Total, Agip, Elf and Panocean. NNPC spokesman Mr. Ndu Ughamadu was however, not immediately available to comment.
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