By Chen Aizhu
(Reuters) -China’s CNPC has continued to export crude from a newly expanded oilfield in Niger that has generated more than $2 billion in revenue despite disputes with government officials over hiring more local workers and improving their benefits, sources with knowledge of the situation said.
The Chinese state oil giant has been negotiating with the Nigerien government for months to tackle those issues, the sources said, after three of its senior executives were expelled in March due to disputes over a pay gap between local workers and Chinese expatriates.
CNPC’s crude sales and the status of the negotiations have not been previously reported. CNPC and a Niger government spokesperson did not respond to requests for comment.
The expulsions, which were followed by government letters in May ordering experienced Chinese expatriates to leave Niger, dealt a blow to CNPC. Niger is a showcase of CNPC’s ability to build an oil industry from scratch in an impoverished nation. It invested more than $5 billion there, developing an oilfield, building a refinery and a 1,950-km (1,212-mile) pipeline, Africa’s longest.
Oil minister Sahabi Oumarou initially asked CNPC and its refinery, SORAZ, to terminate the contracts of expatriates who had been working in Niger for more than four years, but that action has not been carried out, three Niamey-based sources told Reuters.
Among the key disputes was the Nigerien government’s request to increase local hires at CNPC-led projects to 80% versus less than 30% at present, a goal that CNPC believed to be unrealistic due to a lack of trained, skilled local staff, the people said.
The sources spoke on the condition of anonymity due to the sensitivity of the matter.
MELECK CRUDE EXPORTS
Despite the dispute, CNPC has made progress in marketing new production from the phase-2 development of the Agadem oilfield, which is now pumping at a full capacity of 90,000 barrels a day. The crude is exported via a CNPC-built pipeline linking the oilfield with the Cotonou port in Benin.
CNPC holds a 65% stake in the Agadem field, Taiwanese state firm CPC owns 20% and the Nigerien government holds the remaining 15%.
So far, CNPC has exported 32 million barrels of Meleck crude, ideal for making low-sulphur marine fuel, to customers in Europe and Asia, according to one of the sources and a separate trading executive.
Priced at $65 to $70 a barrel, with buyers including global trading houses and CNPC’s trading arm Chinaoil, the exports have generated revenue of more than $2 billion, the sources estimated.
CNPC began producing oil at Agadem, in southeastern Niger, in 2011 under a phase-1 development with agreement from the then-civilian government. The 20,000 bpd production feeds the Soraz refinery in southern Niger, which was built and is 60% owned by CNPC, which supplies fuel to Niger.
Niger’s current junta government came to power in 2023 in a military coup and has, like several other governments in the Sahel region of north-central Africa, been seeking greater control over its natural resources.
(Reporting by Chen Aizhu and Niger newsroom; Editing by Florence Tan and Thomas Derpinghaus.)
