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Senators protest allocation of 83% of oil blocs to Northerners

By on March 7, 2013

Senators from the oil-rich South-South region, on Wednesday, alleged that there was an imbalance in the allocation of oil blocs in the country, saying wealthy individuals from the North own 83 per cent of oil wells that are not in control of the multinationals.

This disclosure was made at the debate of the general principles of the Petroleum Industry Bill, PIB, which began on Tuesday.

The lawmakers also discussed extensively on the three contentious issues of 10 per cent host communities’ funds; perceived excessive powers to the petroleum minister and lack of financial autonomy and independence for the National Frontiers Exploration Agency.

Speaking on behalf of South-South senators, the Chairman, Senate Committee on Rules and Business, Senator Eta Inang, called for “equity and federal character in the allocation of oil blocs in this country,” saying “83 per cent of oil blocs in this country are held by northerners.”

To substantiate his claim, Inang tendered documents which shows that, Alhaji Mai Deribe, General T. Y. Danjuma, Mallam (Prince) Sanusi Lamido, Alhaji (Col.) Sani Bello of Kontangora, Dr. Rilwani Lukman, Alhaji Mohammed Indimi and Alhaji Aminu Dantata, all own oil blocs.

He said Deribe from Borno State owns Cavendish Petroleum, operator of the OML 110 with average revenue of about N4bn monthly.

The documents also shows that Seplat/ Platform Petroleum, operators of the Asuokpu/ Umutu Marginal Field has Lamido as a major shareholder and director, while South Atlantic Petroleum Limited, SAPETRO, was established by Danjuma, who is also the Chairman of Eni Nigeria Limited. SAPETRO partnered with Total Upstream Nigeria Limited, TUPNI, and Brasoil Oil Services Company Nigeria Limited to become operators of the OPL 246.

Inang added that AMNI International Petroleum and Development Company is owned by Bello. “They are the operators of OML 112 and OML 117; while a former Petroleum Minister and former OPEC President, Lukman, another northerner manages AMNI oil blocs and with very key interest in the NNPC/Vitol trading deal.

“Oriental Energy Resources Limited, a company owned by Indimi runs three oil blocs: OML 115, the Oldwok field and the Ebok field; Dantata’s Express Petroleum and Gas Limited, operates OML 108, while OML 113 allocated to Yinka Folawiyo Petroleum Limited is owned by Alhaji Wahab Folawiyo.

“Alhaji Saleh Mohammed Gambo, the operator of North East Petroleum Limited, is the holder of the OPL 215 licence. The company was awarded the blocs OPL 276 and OPL 283 and closing thereupon a Joint Venture Agreement with Centrica Resources Nigeria Limited and CCC Oil and Gas.

“INTEL is owned by Atiku, Yar’Adua and Ado Bayero and has substantial stakes in Nigeria’s oil exploration industry both in Nigeria and Sao Tome and Principe.

“Mike Adenuga’s Conoil is the oldest indigenous oil exploration industry in Nigeria with six oil blocs, while OPL 291 was awarded to Starcrest Energy Nigeria Limited, owned by Emeka Offor, which was sold to Addax Petroleum,” Inang said.

Meanwhile, the senators yesterday agreed to close ranks and commit the draft bill to the third reading or committee stage, where all contentious issues would be addressed.

Senator Mohammed Goje, who opened contributions on the bill after listening to his colleagues, said he understands the need to support passage of the bill to the next stage where the necessary changes would be effected.

“We should allow the bill to go on and do a surgical operation on it by removing and adjusting the contentious areas.”

He said the bill had exposed the inadequacy of the administration of the 13 per cent derivation funds by the governors of the beneficiary states, calling for the restructuring of the funds in order to reduce the amount accrued to the governors and increase the amount available to the oil producing communities.

Goje, however, called for a second look at the issues of “excessive powers” given to the minister and other contentious issues.

Senator Gbenga Kaka on his part lamented that, “we do not give too much power to the minister of the sector that is the live-wire of our economy.”

In his contribution, Senator Barnabas Gemade, welcomed the draft bill as “a piece of legislation that would reform the oil and gas sector,” but also raised concerns about the excessive powers given to the Minister.

He listed three critical agencies which the bill created, but are under the control of the minister as the Petroleum Technology Development Fund, PTDF; Petroleum Equalisation Fund, PEF, and the Assets Management Company to substantiate his point.

Senator Chris Anyanwu threw her weight behind the host communities’ funds as, “it removes the alibi for crime by giving the host communities a sense of belonging.”

She gave examples of other countries that had similar laws to include Brazil, Malaysia and Singapore.

The lawmaker said: “It creates room for host communities to be involved in oil production. It also reduces risk elements because it gives the host communities sense of belonging.

“Most importantly, it has provision for sanctions against host communities that engage in vandalism.”

Former Kaduna state governor, Senator Ahmed Makarfi said the host communities’ funds was about the management, noting that the bill provides for the minister to manage the funds and the royalties that will be paid by the oil companies.

“How will the communities’ funds be managed? We need to look into the structures that will manage the funds,” he added.

The debate on the general principles of the bill is expected to be concluded today.