Cameroon Increases Transit Fee on Chad Oil Pipeline

Reuters

YAOUNDE, Oct 30 (Reuters) - Cameroon's government and COTCO, the company that owns and manages the pipeline shipping oil from Chad to Cameroon's coast, have agreed that the transit fee paid to the government will be more than tripled.

Cameroon will now receive 618.02 CFA francs ($1.30) per barrel of oil, up from 194.91 CFA francs, according to an agreement signed on Tuesday but announced by Cameroon's state oil company SNH on Wednesday.

"This rate will be upgraded every five years based on the average rate of inflation provided by Central Africa's regional central bank," the statement said.

SNH said that 410.42 million barrels of oil were shipped to Cameroon's Kribi port through the pipeline between October 2003, when oil started flowing, and October 2011.

Cameroon earned some $168 million in transit fees as a result, the statement said.

SNH said in another statement on Wednesday that Cameroon has signed an agreement to allow new oil producer Niger to ship its crude through the pipeline to the Kribi port for export.

Landlocked Niger, a major uranium miner, began pumping oil in 2011 from its estimated 650 million barrels Agadem field situated about 1,600 km (1,000 miles) east of the capital Niamey.

"Niger's hydrocarbons production is about 60,000 barrels per day and to make it worthwhile, there was a need to choose a shorter course that could entail less investments. That is why we choose the Republic of Cameroon," energy minister Foumakoye Gado said.

Gado said a 600 km pipeline will be constructed to link to the Chad-Cameroon pipeline.

COTCO is a venture vehicle that manages the Cameroon portion of the pipeline from Chad. It is owned by ExxonMobil Corp , Chevron Petronas and the governments of Chad and Cameroon.

Copyright 2016 Thomson Reuters. Click for Restrictions.

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