Japaul Oil & Maritime Services Plc, a Nigerian petroleum-services company, plans to raise 27 billion naira ($70 million) in a share offer in November to fund its switch to mining as crude exploration and production activities wane.
The Lagos-based company, which currently provides offshore construction, equipment leasing and oilfield-support services, has experienced a decline as oil prices fell in recent years, forcing energy companies to cut back on investments, Chairman Jegede Paul said in an online interview from Lagos.
“The oil companies that we are serving have little jobs to do and the little jobs that are there, we are all battling to do at prices that are below our costs,” said Paul. “By the next two years, we will completely be a mineral company.”
Japaul is working with Toronto-based Matrix Geotechnologies Ltd as the consultant for its operations and has obtained licenses to mine gold, lead, nickel and copper it identified in commercial quantities in different parts of Nigeria, Paul said. The company also wants to acquire smaller companies that already have licenses for those minerals to boost its production.
Its shift to other minerals comes at a time the West African nation is seeking to diversify the economy away from dependence on oil, the source of more than 90% of foreign-exchange earnings. Nigeria started gold refining in June as part of moves to boost its bullion reserves with the Central Bank of Nigeria.