Nigeria Lost $565.8m To Mismanagement Of Oil Mlocs —Reps

Honourable Yakubu Dogara
Honourable Yakubu Dogara, Speaker of the House of Representatives

THE House of Representatives ad hoc committee probing the awards of Oil Prospecting Licences (OPLs) and OIL Mining Leases (OMLs) by the Department of Petroleum Resources (DPR), on Wednesday, lamented that the nation had lost the whopping sum of $565.8 million due to poor management of the allocation of the blocs by the department.

According to the committee, chaired by Honourable Gideon Gwani, the colossal loss arose due to the inability of the DPR to hold the oil companies to their commitments in agreements entered to before getting the oil blocs.

The committee made the observation on Wednesday, in Abuja, at the opening of a two-day investigative hearing on the awards on all OPLs, OMLs and other oil and gas assets granted by the Federal Government between 2005 and 2007.

The committee also expressed displeasure over various infractions in the allocation of the oil blocs identity of the beneficiaries/winners of the blocs and indiscriminate transfer of oil blocs to companies that did not participate in the award process.

Consequently, it summoned the Group Managing Director (GMD) of the Nigeria National Petroleum Corporation (NNPC) and the Minister of State for Petroleum, Dr Ibe Kachikwu, the immediate past Petroleum Minister, Mrs Diezeani Alison-Maduekwe, a one-time Minister of State for Petroleum under former President Olusegun Obasanjo, who is now a traditional ruler in Bayelsa State, His Majesty, Dr Edmund Maduabebe Daukoru and others to appear in person to shed more light on the transactions.

The committee rejected the claim by the Permanent Secretary, Federal Ministry of Petroleum Resources, Mrs Jemila Shuara, that both Mrs Alison-Maduekwe and King Daukoru could not be traced, as they had no forwarding addresses, saying while that of Mrs Alison-Maduekwe could be taken, that of the traditional ruler, King Daukoru, was not tenable.

It urged the ministry to immediately dispatch its officials to Bayelsa State, to locate the king and inform him that he should appear before the committee since the transactions were allegedly carried out when he was a minister of state.

The committee which queried the DPR as to why it would tag the loss of $565.8 million due to non-payment of licencing fees which spanned through a period of three different bidding rounds in 2005, 2006 and 2012, frowned at the use of the term “outstanding payments” as referred to by a Deputy Director of DPR, Mr Sunday Adebayo Babalola while making a presentation on behalf of the agency.

The committee also discovered some alleged conspiracies and sharp practises perpetrated by DPR, wherein it awarded oil blocs to companies other than those who bidded for and won the licences without any evidence of disqualification or a right of first refusal of the original winners of the bids.

It had earlier asked how many of the blocs were awarded using open competitive bidding and those through discretion by the minister, as well as evidence of advertorial announcing the bidding process for the blocs, with the DPR insisting that every bid round followed a transparent and due process.

According to Babalola while responding to a question: “People behind the companies which got allocated blocs were all unveiled during technical process before the bidding was done.”

Speaking on the blocs won by a company allocated to another, he said that happened in 2005 and 2006 bid rounds for specific reasons.

The committee, therefore, reeled out instances of diversion of OPLs, such as OPL 907, 917, won by VP Energy Limited, but were given to another company, as well as other instances.

However, Kachikwu, who was represented at the hearing by the Permanent Secretary in the Ministry, Mrs Shuara, expressed the need for a policy rejig that would clean up the oil industry.

Earlier, the Speaker, Honourable Yakubu Dogara, represented by the Deputy Minority Whip, Honourable Yakubu Umar Barde, as well as the committee chairman, Honourable Gideon Gwani, in their addresses, had said the investigation was not aimed at witch-hunting anybody, but geared towards establishing how the nation’s resources had been managed by agencies of government tasked with the responsibility of doing so.


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