Indigenous oil firms sell off assets as recession hits hard

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The current economic recession in the country appears to have taken its toll on indigenous players in the nation’s oil and gas industry as some of them have been selling off their assets to pay back loans taken from banks, Vanguard reports.

Their misfortune is compounded by the fact that some of the jobs gotten from the international oil companies (IOCs), have been put on hold, coupled with  their inability to source foreign exchange in order to import materials. The Chief Executive Officer of an oil servicing company who preferred to be anonymous said that the situation is excruciating for indigenous companies as some of them had to sell off assets to pay off debts.

The CEO explained that the major challenge confronting independents in Nigeria are predicated on the international market price.  According to him, “Some of them can produce but they cannot evacuate. They have taken facilities from multi-national organizations to fund their operations and doing that is predicated on cash flow from sales. When sales are interrupted, the cash flow will decline and the multi-nationals will still come for their money.”

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