Seeking to expand its footprint overseas, Indian Oil Corporation (IOC) Limited is now looking to set up a greenfield refinery in Nigeria.
According to an industry official familiar with the development, the Nigerian government is in talks with IOC to set up an oil refinery in the west African country. “Discussions between IOC and Nigerian government are at an early stage. Nigeria is keen to use IOC’s expertise in the refineries segment,” said Dr Emmanuel Egbogah, Chairman of Lagos-based Emerald Energy Resources Limited and a former special adviser to the President of Nigeria on Petroleum Matters. Besides setting up a refinery in Africa’s largest oil producing country, Egbogah said the Nigerian government has also sought IOC’s help in managing its refineries.
With a maximum crude oil production capacity of 2.5 million barrels per day, Nigeria is the biggest producer of oil in Africa and the sixth largest oil producing country in the world.
Nigeria, which is also a member of the 12-country bloc of Organization of the Petroleum Exporting Countries (OPEC), produced about 2,111 thousand barrels per day of crude oil last year, according to OPEC data.
IOC currently doesn’t have presence in Nigeria, neither directly nor indirectly. Many African countries, including Nigeria have rich oil, gas and mineral resources with a number of Indian firms, both public and private sector looking to acquire assets there. Around 15% of the crude oil India imports come from Nigeria.
Over the last few years, many government-owned oil and gas companies have evinced interest in buying stakes in energy assets in African countries. Companies like GAIL (India) and IOC are interested in sourcing oil and liquefied natural gas on long-term basis from Africa. Indian oil and gas companies are also exploring possibilities of equity participation in existing or proposed LNG liquefication projects; business opportunities in gas processing and gas based petrochemical projects in Africa; and farm-in opportunities in producing gas blocks for conversion to LNG and dispatch to India.
With business interests straddling the entire hydrocarbon value chain - from refining, pipeline transportation and marketing of petroleum products to exploration & production of crude oil & gas, marketing of natural gas and petrochemicals, the Indian Oil Group owns and operates 10 of India’s 22 refineries with a combined refining capacity of 65.7 mmt per annum.
Having set up subsidiaries in Sri Lanka, Mauritius and the United Arab Emirates (UAE), IOC is simultaneously scouting for new opportunities in the markets of Asia and Africa.