Amidst repeated calls for transparency in the governance of Nigeria’s opaque oil industry and delayed passage of Nigeria’s Petroleum Industry Bill, the Nigerian government’s recent renewal of oil licences may have been marred by accountability and transparency challenges.
The integrity of the exercise, from which the government said it generated over $1 billion, continues to generate ripples among stakeholders.
The renewal was done under an accelerated lease renewal programme initiated by the Department of Petroleum Resources (DPR) to raise money for the government and incentivise operations in the country’s upstream oil and gas sector.
Despite assurance by the Federal Government that there were no irregularities in the renewal of the over 42 oil licences, PREMIUM TIMES’ analysis of the exercise raises transparency concerns.
Licences; production status
There are 42 licences due for renewal in 2019. The licences comprise of 35 Oil Mining Leases (OML) and seven Oil Prospecting Licenses (OPL).
The licenses are about 17 OMLs operated by Shell Petroleum Development Company; OMLs 4, 38, and 41 operated by Seplat Petroleum Development Company Plc; OMLs 40, 42, 26, 34 64, 65, and 66 operated by NPDC, as well as OMLs 116 and 117, operated by Agip Energy and Natural Resources and Amni International Petroleum Limited.
Others are OML 114, which is operated by Moni Pulo Limited; OML 115, by Oriental Energy Resources Limited; and OML 29, operated by Aiteo Eastern E&P Company Limited.
The rest are: OMLs 24, 18 and 30, operated by Newcross E&P Limited, Eroton E&P Company Limited, and the Nigerian Petroleum Development Company/Shoreline Natural Resource Limited, respectively.
One of the measures with which industry experts access licences is to appraise the production status of the fields. PREMIUM TIMES did an independent check of the available status of some of the fields in 2018.
For OML 114, operated by Moni Pulo, the production status was put at 0.693172 million barrels for 2018. For OML 116 by Eni, the production figure was given as 1.134632 Mmbbl for the same year.More in Business
For OML 024, operated by NewCross, the production figure was 0.0803664 Mmbbl while that of OML 079 by NNPC was put at 5.778482 Mmbbl.
According to the Petroleum Act of 1969, the Minister of Petroleum Resources is authorised to renew oil licenses once statutory payments in terms of applicable royalty, concession rentals and fees are paid.
This position is also strengthened by the Petroleum (Drilling & Production) Regulation of 1969 (as amended in 2001).
But the opacity in the management of Nigeria’s oil industry, coupled with the delayed passage of the Petroleum Industry Bill (PIB), remains a major setback for the country.
SOURCE: premiumtimesng.com