The Federal Government has agreed to give China and South Korea four oil blocks each, as collateral for loans from the two countries.
Their shares of the production volumes will be calculated to match the total interest accruable on the loans.
The blocks offered the Chinese have been allocated in return for an investment package financed by a $2.5bn loan.
However, the value of the Korean loan was not disclosed.
The Energy Minister, Dr. Edmund Daukoru, who confirmed this development on Sunday, said that the Korea National Oil Corporation and China National Offshore Oil Corporation had been given the right of first refusal for four oil blocks each to be awarded in the next licensing round scheduled to holdin March.
While final agreements were yet to be reached with the Koreans, the minister said that that of the Chinese had been concluded a week ago.
�We are very anxious to do the deal with the Koreans by the end of March,� said Daukoru, in an interview with Dow Jones Newswire.
It is the first time Daukoru has confirmed how many blocks the South Korean company, better known as KNOC, would receive in exchange for a long-term, low- interest loan being put up by the South Korean government.
Daukoru said the CNOOC deal was finalised a week ago, after Nigeria received an official letter from the Export-Import Bank of China, nominating the company to manage the blocks.
Oil and gas companies from China and South Korea have been targeting energy reserves in Nigeria, using government-to-government agreements backed up by low- interest loans to secure preferential treatment over competitors.
Both Asian countries are major oil importers, and are attracted to Nigeria�s sweet crude oil because it is cheaper to refine into petroleum products than crude from some other exporting nations.
The blocks to be awarded to CNOOC must be �producing,� although, according to Daukoru the exact interpretation of this clause still needs to be agreed by CEB and the Nigerian government.
The blocks should have reserves that companies can add to their bottom line, � whether they are flowing or not,� Daukoru said in the interview. �That is the way I�d like to interpret it,� the minister said.
The CNOOC deal is likely to include reserves of around 600million barrels of oil, although it remains to be seen whether China would be happy with blocks where production has yet to begin, especially considering its fast-growing energy needs.
�It may not be all of the four (blocks), but some of them will be ones with absolutely clear-cut prospects,� Daukoru said.
He described them as �blocks where the government is backing in, with the possibility of early production coming, albeit not yet in production.�
Last year, KNOC won the exploration rights for two offshore blocks in Nigeria. This came with a promise from the Koreans to construct a 1,200 kilometer gas pipeline running from the Niger Delta to Abuja and to fund a fertilizer plant and a power station with a capacity of 2,250 megawatts.
Under the terms of a memorandum of understanding with Nigeria, in November that forms the basis of its right to the four blocks, Korea agreed to fund a 1,500- kilometer-long railway project connecting Port Harcourt-Abuja-Maiduguri.