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Monday, February 17, 2014
Glencore and Mercuria, two trading houses, are among a select group of firms that are expected to make final bids on assets in Nigeria that are being sold off by Shell, Total, and ENI. The assets are thought to be worth an estimate $3 billion.
While Glencore and Mercuria are trading houses dealing in the trade of crude oil among other things, taking on upstream assets would eliminate a step in the process of selling crude.
Shell and its partners are a bit tight-lipped when it comes to what assets are up for sale and bidders are bound by a confidentiality agreement; however, rumor has it that the blocks include OMLs 18, 24, 25, and 29. Shell is also said to be selling its 97-km Nembe Creek oil pipeline.
Final bids for the stakes in the blocks are due on February 18.
Under the government’s local content policy any foreign companies wanting to buy divested assets needs to partner in consortiums with Nigerian firms. Glencore is preparing to bid in a consortium with an unnamed Nigerian firm which will mark the company’s first foray into Nigeria’s upstream sector, although it does have units operating in other African countries upstream arenas.
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