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HomeTop NewsPresident Buhari overrules DPR on Addax assets revocation, returns oil licenses to...

President Buhari overrules DPR on Addax assets revocation, returns oil licenses to NNPC

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By Oludare Mayowa

Four weeks after the Department of Petroleum Resources (DPR) revoked the four oil mining licenses issued to Addax Petroleum Company, President Mohammadu Buhari has reversed the revocation and ordered the return of the licenses.

A statement issued by presidential spokesman, Garba Shehu on Friday said the president has approved the restoration of the leases on OMLs 123, 124, 126 and 137 to the Nigeria National Petroleum Corporation (NNPC).

The statement claimed that the NNPC was in a “production sharing contract with Addax Petroleum, a company wholly owned by Government of the People’s Republic of China on the blocks” on the oil assets revoked.

Last month, DPR had revoked the four assets of Addax Petroleum Exploration Nigeria, namely OMLs 123, 124, 126 and 137 due to the non-development of the assets by the company.

The DPR Director, Sarki Auwalu said that the revocation order was in fulfillment of the Federal Government’s commitment to reactivating all moribund oil and gas support facilities across the country.

On Thursday, the DPR inaugurated a committee consisting of experts to evaluate the revoked assets preparatory to the handing over of the assets to their new owners, Kaztech/Slavic Consortium.

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However, on Friday, Shehu said “in line with the current administration’s commitment to the rule of law, fairness and enabling a stable business climate for investment, President Muhammadu Buhari has approved the restoration of the leases on OMLs 123, 124, 126 and 137 to the Nigeria National Petroleum Corporation (NNPC) which is in production sharing contract with Addax Petroleum, a company wholly owned by Government of the People’s Republic of China on the blocks. The leases belonging to the Federation were revoked on March 30, 2021.

According to him, the development reaffirms the commitment of President Buhari to the rule of law and sanctity of contracts.
“While directing the Department of Petroleum Resources, DPR to retract the letter of revocation of the leases, the President also directed NNPC to utilize contractual provisions to resolve issues in line with the extant provisions of the Production Sharing Contract arrangement between NNPC and Addax.

“The restoration of the blocks to NNPC will boost the organisation’s portfolio, thereby making the Corporation to, in the long run, boost its crude oil production and in turn increase the revenue it generates to the Federation Account,” Shehu said in the statement.

However, the position of the president may have put an end to the work of the newly inaugurated committee set up by the DPR to evaluate the current status (As-is) of the revoked assets, including liabilities post revocation.

Equally, the term of reference of the committee to facilitate the takeover of the assets by the operators appointed by the DPR has also been overtaken by the directive of the president.

Experts said the presidential intervention speaks to a lack of coordination among government agencies in the petroleum sector and other sectors of the economy.

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