Monday, Sep 16th 2019 12:24 AM
Lagos
+29°C

Market Digest Nigeria

Economy

President Buhari Revokes Five Oil Mining, Prospecting Licences

President Muhammadu Buhari has revoked four oil mining and one prospecting licences.

Department of Petroleum Resources, said the revocation came on the backdrop of alleged non-compliance with statutory regulatory obligations. The agency said the revocation was to “recover legacy debts” allegedly owed by the affected companies. The development comes months after the Federal Government renewed 42 licences where over $2 billion was reportedly raised to finance the budget. The Petroleum Act 2004 and the Petroleum (Drilling and Production) Regulation of 1969 (as amended in 2001) authorise the Minister of Petroleum Resources to renew or revoke oil licences once statutory payments in terms of applicable royalty, concession rentals and fees are paid or otherwise.

The affected companies are Pan Ocean Oil Corporation (OML 98); Allied Energy Resources Nigeria (OML 120 and 121); Express Petroleum and Gas Company (OML 108); Cavendish Petroleum Nigeria (OML 110) and Summit Oil International (OPL 206). Stakeholders had raised concern over the absolute power of the president to award, revoke and renew licences, urging the passage of laws like the Petroleum Industry Bill (PIB), which Buhari failed to assent to earlier in the year, would have created a more transparent and accountable way to handle licensing processes. One of the affected firms, Pan Ocean, was to commence production of oil and gas from OML 147 at Owa Aladima. The oil well is one of the north’s most developments in the Niger Delta, and also the first to be on production among the 2007 bid rounds.

The firm’s three projects, which will be ready for unveiling at the technical start-up holding June 10, 2019, are to contribute significantly to Nigeria’s industrialisation and economic growth. The liences, which were reportedly renewed earlier in the year, comprise 35 oil-mining leases (OMLs) and seven oil-prospecting licenses (OPLs). Former Minister of State for Petroleum Resources, Ibe Kachikwu, had confirmed the ongoing renewal, stating that all due oil blocks would be approved by the first quarter of the year.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

To Top
SUBSCRIBE NOW!
Get the best of Market Digest Nigeria financial news
delivered to your inbox daily!
By clicking Give it a try, I hereby: Agree and Consent to the Terms of Use and the Privacy Policy
& I may receive free newsletters & promotions from this site and can choose to unsubscribe anytime.