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Petroleum minister denies any irregularities over oil lease renewal

Emmanuel Ibe Kachikwu
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The Ministry of Petroleum Resources has denied any irregularities associated with the ongoing lease renewal undertaken by it and particular, the Department of Petroleum Resources.

It said it would be of essence to note that the early lease renewal programme is a process ingeniously developed to expand and speed up earning potential from the renewal exercise for the Federal Government and to also create security of title to leaseholders so as to allow them continue the massive investments needed to improve production from their fields.

According to the ministry, the process starts with an application from a lease holder, an evaluation from Department of Petroleum Resources, followed by a review by the Honourable Minister of State, Petroleum Resources and culminating in a recommendation to the President for final approval.

The ministry which was reacting to the House of Representatives threat to investigate the Minister of State for Petroleum Resources, Emmanuel Ibe Kachikwu, over alleged irregularities in the ongoing oil and gas lease renewal, said based on the report, the Minister of State and the DPR await the advertised invitation from the legislators, and as always, would respond to clarify any misunderstandings the House may have on the renewed leases as part of the normal oversight functions of the Assembly.

“We would like to state that the Minister of State and DPR are proud of the enormous work done on early renewals, the unprecedented revenue raised under the programme, and the effect it has had on investment.”

The Ministry also stated that would also use this opportunity to clarify that the early renewal programme applies only to renewal of existing leases and does not involve issuance of any new licenses for oil fields.

The lawmakers had threatened that they would also probe the involvement of the Department of Petroleum Resources (DPR) on the allegations.

The threat came following a motion by Chika Adamu at the plenary presided over by the Speaker, Yakubu Dogara, in Abuja.

Moving the motion, Adamu said the Federal Ministry of Petroleum Resources and the DPR were allegedly renewing leases of companies that had failed to pay royalties to the government from oil and gas lifted.

The lawmaker, who represents Shiroro/Rafi/Munya Federal Constituency, said this was in contravention of extant laws.

‘’The House notes that the Committee on Petroleum Resources Upstream observed irregularities in the ongoing renewal of oil and gas leases being undertaken by the Honorable Minister of Petroleum Resources, Ibe Kachikwu, and the Department of Petroleum Resources.

It also noted that the Minister of Petroleum Resources is allegedly granting illegal discounts and rebates in the process of the ongoing renewal of leases.

‘’The House is aware that under the provisions of extant laws, failure to pay royalties is a ground for revocation of leases and a legal barrier to renewal of applicable leases”.

The legislators said they are worried that the Federal Ministry of Petroleum Resources and the Department of Petroleum Resources are allegedly renewing leases of companies that have failed to pay royalties to the government from oil and gas lifted by the said companies, which is in contravention of the extant laws.

‘’The House is concerned that the Ministry of Petroleum Resources and the Department of Petroleum Resources have deliberately, wilfully and brazenly flouted the subsisting legal framework and due process mandated by extant laws for the renewal of leases,” he said.

According to him, the irregularities being perpetrated by the ministry and DPR in the ongoing lease renewal process is capable of denying government revenues in excess of $10 billon as a result of illegal discounts and rebates granted in the process of lease renewal.

He argued that the DPR had deliberately refused to provide the Committee on Petroleum Resources (Upstream) with relevant information and data related to the ongoing lease renewal.

Adamu urged the House to thoroughly investigate the ongoing lease renewal being undertaken by Emmanuel Kachikwu and the DPR to ascertain the reasons for the anomalies observed.

He said this would help to identify appropriate measures to deal with the anomalies through appropriate legislative action.

The lawmakers unanimously supported the motion when Dogara put it to a voice vote.

The Speaker consequently mandated the Committee on Petroleum Resources (Upstream) to investigate the matter and report back to the House within four weeks for further legislative action.

 

Olusola Bello

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