Nigeria cancels South Korea oil deal
Nigeria has cancelled an oil exploration deal signed in 2006 with a South Korean consortium, says the Korea National Oil Corporation (KNOC).
Nigeria alleged that the consortium failed to make agreed payments, KNOC said.
The two offshore blocks were estimated to hold some two billion barrels of crude oil in total.
The move is a blow to Seoul’s efforts to raise its reserves, as South Korea imports all of its oil.
Lawsuit
“The South Korean consortium is studying various measures against the Nigerian government’s unilateral cancellation of the exploration rights,” KNOC said.
“Through close consultations with the [Seoul] government, we are working on various countermeasures which may include a lawsuit.”
The consortium is led by KNOC. Other members include Daewoo Shipbuilding and Korea Electric Power.
It paid $9m in cash and offered a letter of credit to pay another $231m, in order to cover their 60% interest in oil blocks OPL321 and OPL323, which are based in deep water in the Gulf of Guinea.
The deal was signed with Africa’s top oil producer in March 2006 when South Korea’s then president Roh Moo-hyun visited Nigeria.
In return for the exploration rights, South Korea had planned to build a 1,200-km (745-mile) gas pipeline from the southern delta to the capital Abuja and provide 2,250 megawatts of power generation.
source: bbc