Some investors and representatives communities in Niger Delta have condemned the Federal Government’s cancellation of Oil Prospecting Licences (OPL) 2001, 2002 and 2003 in the Utapate Field, stating that it is capable of re-igniting chaos in the Niger Delta region.
The investors affected by the cancellation are Jahcon International Limited, Hi Rev Exploration and Production Limited, as well as Oil and Industrial Services Limited.
Addressing newsmen in Abuja, representatives of some of the investors disclosed that after they won the bids for the blocks in 2007, the bid round was stalled for eight years by litigation until it was resolved amicably in 2015.
After the resolution, the representatives who chose not to be named for fear of victimisation, said the Department of Petroleum Resources handed offers of OPLs 2001, 2002 and 2003 to Jahcon International Limited, Hi Rev Exploration and Production Limited, as well as Oil and Industrial Services Limited, respectively.
The representative of one of the major investors in OPL 2001 stated that many Niger Delta indigenes were pained by the action of the President in revoking the licences of citizens from the oil rich region without carrying out thorough consultations.
The investor stated that angry youths were already threatening to stop any attempt by the NPDC to commence work on the oil field, adding that traditional rulers, as well as investors who won the blocks during the bid round had been engaged in calming several agitators.
For investors in OPL 2002, they noted that although the court had directed all parties to stay action with respect to working on the field, officials of the NPDC recently made moves to commence activities on the field.
However, in his reaction, Group General Manager, Group Public Affairs Division of the NNPC, Mr. Ndu Ughamadu, confirmed the development and stated that the case was in court and that the NNPC and its subsidiary, NPDC, would abide by the rulings of the court.
Ughamadu said, “I don’t want to comment on what they are dishing out because we are already in court. We have made two appearances in court on this matter. It is only the court that resolves issues like this and if it rules tomorrow that the decision taken on Party A is wrong, then we will abide by the ruling of the court.
“This, however, is subject to the advice of our legal adviser, because the corporation is a law abiding corporate institution. If they want to exhaust the case in court they should go ahead, but if they want public debate on it, they should also go ahead, for they are also at the National Assembly on this matter.”
Meanwhile, copies of the letters which were issued to the investors on June 16, 2015 by the Department of Petroleum Resources, DPR, were made available to journalists, in which the DPR confirmed the three investors as successful bidders for the blocks and directed them to make the required payments as signature bonuses for the licences.
The representatives said two of the firms, Jahcon International Limited and Oil and Industrial Services Limited made complete payments, while Hi Rev Exploration and Production Limited made part payment and is still in the process of completing its transaction with the DPR.
The representatives stated that regardless of all these, President Muhammadu Buhari approved a request by the Nigerian National Petroleum Corporation demanding the withdrawal of the licences from the investors and handing over the oil blocks to the Nigerian Petroleum Development Company, NPDC, subsidiary of the NNPC.
In the NNPC’s letter of request to Buhari, dated December 20, 2016, shown to newsmen, the Group Managing Director of the NNPC, Mr. Maikanti Baru acknowledged that OPLs 2001, 2002 and 2003 in OML 13, which were recovered from Shell by the administration of former President Olusegun Obasanjo, were “inadvertently revoked” by Obasanjo’s administration and “back-converted to greenfield OPL before being resized into OPLs 2001, 2002 and 2003 and offered under the 2007 Licensing Round.”
However, the investors argued that Maikanti’s letter, which insisted that the OPLs belong to NPDC, did not disclose that NPDC also submitted a bid for one of the blocks in the 2007 open licensing round but lost as a result of low bid.
They argued that Baru’s claim that the oil field belong to NPDC, a core partner in the field when it was operated by Shell, was baseless on the ground that the government revoked the possession of the oil field by Shell and opened it up to investors in the 2007 bid rounds.
The investors further alleged that Baru forwarded the NNPC’s request directly to the president without seeking legal advice from the Ministry of Justice, or consulting the Minister of State for Petroleum, Dr. Ibe Kachikwu.
In the letter, the NNPC boss also requested the President to grant approval for NPDC to bear the refund to the offerees of OPLs 2001 and 2003 for the sums of $46 million and $34 million respectively, and thus absolve DPR of such refund obligation.
It was observed that Buhari approved the letter the same day that it was brought to him by Baru, which was on December 20, 2016, and his comment on the request was “GMD, prayer approved.”
After the President’s approval, Chief of Staff to the President, Mr. Abba Kyari, wrote a letter to the NNPC boss on December 20, 2016, conveying the President’s approval of the corporation’s request with respect to the withdrawal of the OPLs from the awardees and handing it over to NPDC.
Afterwards, On December 21, 2016, Baru wrote a letter to the DPR conveying the presidential approval for the restoration of the oil field to NPDC.
As a result, Director of DPR, Mr. Mordecai Ladan, wrote two letters, dated February 15, 2017, informing Jahcon International Limited and Oil and Industrial Services Limited of the revocations of the acreages, citing “a review of the reconversion process of the former OML 13 to OPLs 2001, 2002 and 2003.”
