Nigeria Oil Company, Exxon Joint Venture May Issue Bonds in 2016

Nigeria’s state-owned oil company and Exxon Mobil Corp. (XOM)’s local unit may decide to tap the bond market in 2016 as an alternative source of funding for their joint venture.

“The challenge of today is that a lot of people are going into the bank market, and the avenue is being crowded, making it difficult for us to obtain sufficient funding,” Mobil Producing Nigeria’s Chief Financial Officer Segun Banwo said in a statement on the Nigerian National Petroleum Corp.’s website. “From the years 2013 to 2015, we will continue to use the external financing option, but by the year 2016 we would switch to the bond market.”

Exxon Mobil, the second-largest producer in Nigeria, is the operator of a joint venture in which it holds a 40 percent stake, with NNPC holding the rest. The company has daily output capacity of about 550,000 barrels of crude from 90 offshore platforms and about 300 oil wells, according to its website.

Exxon in June said it concluded a $1.5 billion financing arrangement with NNPC, with a $900 million loan sourced from a group of Nigerian and international banks.

To contact the reporter on this story: Chris Kay in Abuja at ckay5@bloomberg.net

To contact the editor responsible for this story: Vernon Wessels at vwessels@bloomberg.net

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