As the divestment by International Oil Companies gathers steam, many issues are yearning for answers in the oil sector. Key among these issues are abandonment, decommissioning, oil theft, pipeline vandalism, mounting court cases, and the environmental pollution. KINGSLEY JEREMIAH, writes on the issues and the way forward.
From 2010 to 2015, divestment by Shell in Nigeria included interests in OMLs 4, 38, and 41, which were sold on July 30, 2010. Others are OMLs 26 and 42, which were sold on November 30, 2011; OML 40 on August 31, 2012; OML 34 on September 5, 2012, and OML 30 on November 9, 2012, respectively. Still at loggerheads, earlier this year, Seplat Energy Plc., said it struck an agreement to acquire the entire share capital of Mobil Producing Nigeria Unlimited from Exxon Mobil Corporation, Delaware, United States for $1.28b. The transaction is reminiscent of the $1.5b ConocoPhillips Nigerian operation acquisition by Oando Plc., in 2014 and entails the acquisition of ExxonMobil Nigeria’s entire offshore shallow water business.
Although a problem that would have been avoided if the Federal Government and the oil companies were futuristic and fair, oil theft and vandalism have repeatedly been blamed by most IOCs as one of the major reasons that the shallow water, which primarily gave IOCs a foothold in the country, has now become a forbidden venture.
One of the divesting firms, TotalEnergies was very specific on the reason for divesting from the shallow water. Its chief executive officer, Patrick Pouyanne, at an earnings conference was quoted by Bloomberg as saying that “disruption by local communities are sources of great concerns.’’ “One of the biggest problems that we have in the sector has been a lack of investments. In the last 10 years, over $70b worth of investments came into Africa. But sadly, less than $4b of this came to Nigeria, which is surprisingly the biggest country in Africa. If we cannot attract investments to Nigeria, you know where we are heading,” Sylva told a delegation of the European Union , who paid him a visit in Abuja.
Before this period, a federal court in Lagos had frozen Shell’s subsidiaries’ bank accounts in Nigeria and prevented it from withdrawing money in about 20 local banks over a lawsuit by Aiteo claiming potential damages.
Source: News Formal (newsformal.com)
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