Chinese Government pledges $4 billion for oil-for-infrastructure deal

On April 26, 2006, Chinese President Hu Jintao and Nigerian President Olusegu Obasanjo signed an agreement to exchange four oil drilling licenses for a commitment of $4 billion USD in infrastructure from China to Nigeria.

Under this agreement, Nigeria would grant China the first right of refusal to China National Petroleum Corp. (CNPC) on four oil exploration blocks at an auction next month.

China had hoped to buy a controlling stake in Nigeria's 110,000 barrel/day Kaduna oil refinery and to reconstruct Kaduna's facilities for $2 billion USD. However, in 2007, China failed to win the auction for Kaduna's stakes. The statuses of the power station and the promised infrastructure are unknown.

Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.