There are palpable fears among International Oil Companies (IOCS) operating in Nigeria’s multi-billion dollars oil and gas industry as the federal government blew hot on the operations of the controversial Joint Venture oil blocs, declaring that whoever buys the IOCs interests with intention to operate does that at its risk.
The Nigerian government, owner of 55 per cent shares in all the oil fields, maintained that bidders for the interest, which Royal Dutch Shell is selling, should beware of the need to forget the operatorship of the fields.
The government also stated it was ready for the takeover of the fields operated by the IOCs declared that the Nigerian National Petroleum Corporation (NNPC) is matured to operate the fields.
Group General Manager, Group Public affairs of the NNPC, Dr. Levi Ajuonuma said in a telephone interview that the government, being the highest shareholder does not need to beg anybody for the operatorship, “which would be done through the Nigerian Petroleum Development Company (NPDC).”
He said “The NPDC is now competent to operate the oil fields and that is why we have put Caveat Emptor in the Newspapers concerning the oil fields.
“It is our right to operate the field and we, as the major shareholders, do not need anybody to get the operatorship in a situation like this. Let me tell you why all the IOCs got the operatorship of the oil fields in Nigeria. It is simply because the nation was so young then, now we are matured to take over the operatorship and thank God that this is in our agreement.”
He added, “Conoil, with due regards cannot in any way be compared to the NPDC. Please let it be on record that whoever gets the operatorship outside the NPDC did that at its own peril.”
SacOil Holdings limited had earlier disclosed that the government demanded the right to operate through the Nigerian National Petroleum Corporation (NNPC).
SacOil’s Chief Executive Officer Robin Vela said that the NNPC asked for the operatorship of the licenses in which Shell is selling its interests.
South African explorer SacOil was unsuccessful in its joint bid, with Essar Group and Energy Equity Resources Limited., for Shell’s interest in the OML 42 license.
“Clearly that raises issues for the buyers because you are not in control off the asset,” Vela said in an interview in London.
“It adds another layer of risk to the transaction.”
Kulczyk Oil Ventures Inc. (KOV) said last month it won the bid for OML 42 with a local partner and will acquire the 45 percent interest held jointly by Shell, Total SA (FP) and a unit of Eni SpA. (ENI) NNPC holds the remaining 55 percent.
“The deal is still conditional,” Jakub Korczak, vice president for investor relations at Warsaw-listed Kulczyk, said by phone today. The company hasn’t received notification from NNPC that it wants to become the project operator, though “we’ve seen commercial advertisements in the local newspapers. We are aware” of the situation,” Korczak said.
In addition to OML 42, Shell is also selling its interests in the OML 30, 34 and 40 licenses, Vela said.
“The price was overly exaggerated, we couldn’t see value in entering,” Vela said. “When we were bidding, we were bidding on the basis that our consortium would’ve acquired operatorship.”