Tensions remain high between Benin and Niger, primarily due to the export of Nigerien oil via Benin. The latest incident in this ongoing conflict occurred on the evening of Wednesday, June 5th, with the arrest of five Nigerien nationals at the Sèmè-Kpodji oil terminal, through which Nigerien oil is exported beyond Africa. A Chinese company, Wapco, operates the terminal, which has made it an unwilling center of this diplomatic row.
Once again, the West African Oil Pipeline Company is indirectly working on either side of the border: Wapco Niger and Wapco Benin. Both are affiliate companies of the China National Petroleum Corporation (CNPC), the national oil company of China.
In Agadem, CNPC has been involved in oil extraction. At Sèmè-Kpodji, it manages the terminal that allows the shipment of crude oil by sea. And these same companies were responsible for constructing nearly 2,000 kilometers of pipeline at an estimated cost of 4.5 billion dollars. An agreement was reached in 2018. The Chinese company advanced 4 billion for the construction work in exchange for three-quarters of the future production, the remaining quarter going to the authorities of Niger.
It was in April that CNPC agreed to provide additional financial support, advancing part of the oil proceeds due to Niamey. The Chinese company has granted a $400 million loan to the junta, which has been cut off from its traditional resources and dire need of financing. Exporting oil is also expected to generate significant customs revenue for the Beninese state treasury.
These economic prospects are brighter for both countries, as well as for Wapco, which has not spared a lot on the infrastructure of the project. However, the hopes of business profitability are currently threatened by the diplomatic tensions between the two states that have again put Wapco into the role of the mediator. An initiative made through mid-May allowed the export of the first oil consignment to be made. Another meeting occurred at the end of May in Niamey, but no result materialized for the Chinese company.
According to Chinese authorities, CNPC is running fourteen projects in six African countries: three in Sudan, two in South Sudan, four in Niger, three in Chad, one in Benin, and one in Mozambique.