Refinery and Petrochemical MOU Signed Between Petrol One and the Government of Niger

Tuesday, Nov 04, 2008

Sheikh Walid Al Rawaf, Chairman and CEO, Petrol One Corp. (CNQ:POV), is pleased to announce that the Company has signed a Memorandum of Understanding ("MOU") with the government of the Republic of Niger, Africa, to build a state-of-the-art oil refinery with a capacity of 450,000 barrels per-day, and an adjacent petrochemical processing plant in the Maradi region of Niger.
Project costs are estimated at approximately USD $13.5 billion (thirteen billion, five hundred million United States dollars), based on a feasibility study provided by the government of Niger. Actual project costs will be agreed in the final contract, based on a revised, final feasibility study.
The Company will finance a minimum of 15% of total project costs, estimated at approximately USD $2.025 billion (two billion, twenty-five million United States dollars).
The Company has reserved for issuance a total of 13,500,000 common shares for certain persons instrumental in negotiating this transaction on behalf of the Company, including the Company's Chairman and CEO. The shares will be issued based on milestones, and all 13,500,000 shares will be issued upon completion of the financing for the project.
The refinery is being built to produce the fuels and feedstocks to the petrochemical plant for the production of a variety of marketable commodities.
Under the terms of the MOU, Petrol One will have three key areas of responsibility for the duration of the project:
- Acting as General Manager to administer the construction of the state-of-the-art refinery and petrochemical plant;
- Supplying the equipment necessary for construction of the project; and
- Utilizing Petrol One's existing international networks and affiliations to market all commodities produced by the petrochemical plant.
Niger as the host country has agreed to provide all necessary permits and licences for the construction of the refinery and petrochemical plant and also for the export of the commodities produced by the petrochemical plant. The products may be used domestically or exported to the international marketplace.
Petrol One has negotiated preliminary funding arrangements, in principle, for their portion of the project and will endeavour to reach contractual arrangements in the near future. Petrol One is also working to contract the securing of feedstock for the provision of crude oil for the Niger-based refinery.

Source: Petrolone