Falling Oil Prices, Cash Call Breaches Crashes Mobil Fortunes

Yemisi Izuora
Exxonmobil
Mobil Producing Nigeria Unlimited, (MPNU), operator of MPN/NNPC Joint Venture, is witnessing operational challenges following JV partners to keep to cash call arrangements.

Subsequently, the company has recorded a 53 per cent decline in its activities.

The Manager, Field Law Services, ExxonMobil, Omojuwa Oteri, who disclosed this in Uyo at a stakeholders meeting themed “2015 Energy Outlook Series”, said that the company started experiencing decline in its production activities 10 years ago due to non-release of 60 per cent cash call arrears by the joint venture partners.

“Our joint venture production over the last 10 years had been declining up to about 53 per cent,” he said. “This is majorly because of our joint venture partner’s failure in several instances to honour their cash call obligations to the business.”

He said that the federal government, which is represented by NNPC, was contributing 60 per cent to the joint venture while ExxonMobil paid the balance of 40 per cent, but however noted that the failure of partners to pay obligations to the joint venture had impacted negatively on investments outlook and profitability of the business.

“In addition to this problem, we now find a global trend where the price of oil is right now close to 40 dollars per barrel,” he said. “This affects profitability of our business and outlook for investment.”

He said that ExxonMobil was suffering from difficult times due to falling oil prices and non-payment of cash call obligations from partners; and solicited for the understanding and cooperation of business community, host communities, government and other stakeholders.

In her presentation on ExxonMobil Energy Projection for the year 2040, the General Manager, Estate and Facilities, Elizabeth Essien, said the investment in natural gas was the way forward.

She said that the company was investing in researches to discover unconventional ways of having cheaper, reliable and affordable usage of gas.

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