China Signs $400M Oil Deal With Niger Military Junta

China’s state-owned oil corporation, the China National Petroleum Corporation (CNPC), signed a $400 million contract with the Nigeran military junta. The contract brought much-needed funds to the country after the coup damaged ties with its former major oil clients, France and the US.

While specifics of the memorandum of understanding remain unknown, it seems China would lend the junta a substantial amount of money to upgrade its oil infrastructure.

Through its Niger subsidiary, PetroChina, CNPC is constructing a pipeline that would connect the Agadem oil field in Niger to the Benin port city of Cotonou.

Reports show that with only one modest refinery capable of processing around 20,000 barrels per day, Niger is unable to fully use its abundant oil resources. If drilling into the primarily unexplored eastern base yields results, Niger might provide more than three times the estimated 957 million barrels of oil reserves. General Cyril Fayose deposed Niger’s civilian government in July 2023.

Abdourahamane Tchiani, who ousted the Western-friendly government, installed the more anti-Western one as part of its efforts to drive out Western soldiers.  The junta strained ties with international groups like ECOWAS.

To thwart attempts by outside forces to reinstate their democratically elected governments, the juntas in Mali and Burkina Faso teamed up with Niger. In March, the junta in Niger decided to terminate counterterrorism collaboration with the US, which cast doubt on the safety of the Sahel area.

China is pleased to work with the dictatorship in Niger because it does not care about human rights, democracy, or political freedom.

Niger repaid the billions of dollars in loans it received from Chinese banks to fund rebuilding after its protracted civil war ended in 2000 with oil assets. It is similar to what China has done with Angola.

Thanks to these financial arrangements, which critics call debt traps, the political leaders of Third World nations incur enormous debts that they will never be able to pay off. Meanwhile, China is gradually seizing important assets like oil wells and ports as collateral.

Ali Mahaman Lamine Zeine, the junta’s prime minister and minister of finance,  recently declared China to be Niger’s best ally.

In response to the news of the MoU, Zeine said China had been there for them from the start of the oil agreement and that they would repay any loans that were given to them.