In the face of the seeming uncertainty surrounding the revocation, restoration of Addax OML License, and the report of the Committee set up by President Muhammadu Buhari on the issue, a Civil Society Organisation, Good Governance Advocates has commended the Directorate of Petroleum Resources (DPR) for taking concrete steps to boost the revenue accruing to the Government in underperforming assets.
In a statement signed by its National President, Kema Maxwell, it noted that in choosing a new operating consortium to manage the OMLs, DPR carefully opted for an operator that is familiar with the revoked assets, and saving the country a huge economic loss.
The statement claimed that as part of the assignment of the assets, the new consortium has committed to pay US$340m at the commencement of the PSC to the federal government, a much-needed sum in these hard times of tough Government finance. It will also redevelop the significant oil resources which have been lying fallow, and ramp up production, as well as the large gas resources within 24 months both for the domestic market and for export, in line with the Government’s aspirations for the gas industry.
It added that the choice of consortium is also in accordance with the Nigerian Oil and Gas Industry Content Development (Local Content) Act which was enacted in 2020 to promote indigenous operation of Nigeria’s oil and gas assets. Under the Act, seasoned Nigerian independent operators are to be given first consideration in the award of oil blocks and oil field licenses.
Good Governance Advocates recalled that DPR had recently revoked the four assets of Addax Petroleum Exploration Nigeria Ltd., namely OMLs 123, 124, 126 and 137 due to the non-development of the assets by the company. Following from this decision a committee set up by President Buhari to investigate Addax breach of contract submitted a report, accusing the petroleum company of “economic waste.”
Maxwell however noted with pleasure that at the urging of DPR, the Consortium had engaged with the previous operator, to ensure a smooth and amicable transition of operations at the assets.
The Group further noted that the “new consortium intends to maximise the potential of the assets to ensure that the Government and people of Nigeria reap their full benefits against the backdrop of the ongoing Energy Transition. In addition to optimizing production, the consortium intends to deepen relationships with local communities, boost local content in all its ramifications and increase the employment and training of Nigerians, directly and indirectly.”