The air of uncertainty over when the list of marginal fields to be put on offer in the next licensing round would be released has continued to put prospective investors on edge, fuelling concerns over the transparency of the process.
Interested investors are increasingly worried that one month after the announcement of the bid round, the Department of Petroleum Resources (DPR) has yet to make public the list of the assets to be put up for sale.
It was gathered that there is a list of assets that could be offered circulating among some highly connected Nigerian oil companies. Some of the companies have already told the DPR that they are interested in some of the fields and even gone ahead to say how much they are willing to pay.
It is believed in some quarters that the lack of full disclosure of relevant information regarding the bid round, especially the list of assets up for takes, may be tilting the bid round towards favouring a select group of investors. Some of the investors who have seen the list being bandied are skeptical of its credibility.
It was also gathered that among the 31 fields on the list are Uzuaku field on Oil Mining Lease (OML) 11 in Ogoni land, the Egbolom field on OML 23 that was previously operated by Shell in Rivers State, three offshore fields on OML 100 (Usoro, Ikong, Ibiom) and two on OML 67 (Amaniba and Ekpat).
“I am of the view that it is unfortunate that at this critical period in our life as a nation, such an important transaction is shrouded in secrecy. I am aware that the list of assets (marginal fields) to be auctioned is known only by a few people. Even the new marginal fields’ guidelines are not as well-known and publicised as they should be,” said an industry source who is knowledgeable about the transaction.
According to him, there is a strong chance that the ongoing bid round is just to compensate certain people and for the benefits of certain interests.
“For the DPR and the Ministry of Petroleum Resources to prove otherwise, they need to immediately make all relevant information publicly available. The bid rules should be posted on the ministry’s website and that of the DPR; together with fields to be auctioned. Every relevant piece of information should be made publicly and readily available and accessible. It is also pertinent that the list of bidders as shortlisted from time to time, be made publicly available,” the source added.
Akin Adetunji, executive vice chairman, Terra Energy Services Nigeria Limited, said the DPR should explain why the list has not been published. “It is only the DPR that knows why the list has not been published. If they are calling for bids and publishing guidelines, they should tell why the list of the assets is not yet out.”
A top official in DPR told BusinessDay that the official list of the marginal fields to be auctioned had not been made public, adding that no prospective bidders have seen the list. What is circulating among some people is not the authentic list.”
Diezani Alison-Madueke, minister of petroleum resources, who declared the second bid round open in Abuja on November 28, had stated that 31 fields are on offer with 16 of them located onshore, while the remaining 15 are in the continental shelf.
The announcement was followed by a road show by the DPR to different parts of the country to brief the investing public about the opportunities.
The minister had said that the road show would be followed by a competitive bidding process that would take place over three and a half months, adding that the Federal Government was committed to transparency in the bid process, which is expected to be over by mid 2014.
The DPR had recently issued a notice on its website informing prospective bidders that the 2013 Marginal Field Bid Round was continuing as planned, adding that “modalities and other information on all the fields on offer, including application process, shall soon be uploaded on this site.”
“Prospective applicants are assured that the time frame earlier set for the exercise remains unchanged and reasonable time would be allowed for proper completion at every stage of the Bid Round,” the agency said.
Going by the time schedule for the application process disclosed by DPR during the road show, the list of fields, the map and application forms were to be uploaded to the website by December 14 and the submission of applications and pre-qualification was to take place over 3 weeks from the December 16 to the January 3.
It would be recalled that in 2003, the first marginal fields licensing round was held and 24 licences were awarded to indigenous players, and investors and operators in the oil and gas industry eagerly awaited the next round for over three years.
BusinessDay had on June 10, 2013 reported that investors were eagerly awaiting the next round of licensing, adding that operators whose fields are producing, were angling to have additional ones in order to enlarge their asset bases.
Nigeria, Africa’s top oil producer, seeks to increase its crude oil production to 4 million barrels per day and grow the reserves to 40 billion barrels by 2020, but the industry is being plagued by crude oil theft and delay in the passage of the Petroleum Industry Bill (PIB), which is aimed at overhauling the industry.
By: OLUSOLA BELLO & FEMI ASU