14 February 2013

Nigeria: House Probes Sale of OML 26

The House of Representatives Wednesday directed its Committee on Gas Resources to investigate the sale of an oil block, OML 26, comprising Ogini; Isoko Deep, Ofa and Ovo oil fields located in Isoko North Local Government Area, Delta State.

The order to investigate the sale of the oil bloc came same day the House directed that all goods coming into Nigeria should be fully scanned for both security and revenue purposes, as against the present practice of random scanning of cargoes.

The vast oil field was managed by Shell Petroleum Company of Nigeria in conjunction with the Nigeria National Petroleum Corporation (NNPC) until its controversial sale to another firm, First Hydrocarbon Nigeria Limited.

The House Committee on Gas Resources has been mandated to scrutinise the entire transaction and submit a report with appropriate recommendations to the House, within four (4) weeks.

Deputy Leader of the House, Hon. Leo Ogor brought the issue to the attention of the House as a matter of urgent public importance.

Ogor said that Shell sold the oil bloc in secret, under questionable circumstances and without any notice to the public, land owners, families and host communities.

According to him, there was need to investigate the transaction in view of vast deposits of untapped gas resources in OML 26.

He argued that since the oil bloc is located on the land belonging to families and host communities of Ozoro Kingdom, Shell erred when it did not take these landlords into confidence before the sale.

By virtue of their privilege position, Ogor said, these land owners were supposed to be aware and notified about any transaction concerning OML 26.

He said that the land owners, families and host communities have nurtured these oil facilities on their lands for decades and have suffered environmental degradation throughout and therefore ought to have been given the right of first refusal.

According to Ogor, the action of Shell Petroleum Development Company has left the land owners, families and host communities betrayed, dejected, depraved and deprived of full benefits of their God-given natural resources.

"I am convinced that First Hydrocarbon Nigeria Limited is owned by persons who have served in government in very high capacity and by virtue of the position they held have knowledge of the vast potential of OML 26 and merely used their position to secretly and fraudulently buy OML 26, against office etiquette.

"The deprived land owners, families and host community are vexed, agitated and becoming very restive and the intervention of this honourable House is needed," the lawmaker said.

Also Wednesday, the House considered the report of the Committee on Customs and Excise on the Investigation on the "Need to Prevent continued Loss of Revenue through Ports Inspection."

The lawmakers adopted all the 12 recommendations in the report.

The lawmakers resolved that that all goods coming into Nigeria should be fully scanned for both security and revenue purposes, as against the present practice of scanning based on ASYCUDA random selectivity.

The report recommended that within the transition period, more scanners should be provided at all entry points at all the ports in Nigeria where they are not currently available.

"Measures should also be put in place to ensure that installed scanners are effectively utilised and properly maintained as the scanners are currently grossly unutilised," the report said.

It was also resolved that the Nigeria Customs Service (NCS) should ensure that its officers trained by the various service providers are attached to the service providers in the interim to acquire more on the job training and not post them out to areas irrelevant to the training already received.

The House also resolved that the service providers, including Webb Fontaine, COTECNA SGS and Global Scan should take steps to harmonise their different risk platforms into a single window for the use of the NCS.

The report recommended that a Central Data Management System be established to aid the harmonisation and integration of all data from relevant agencies for effective monitoring.

Other recommendations adopted at the Committee of the Whole include: "That pending the complete takeover of destination inspection services by the NCS, an implementable transition timetable should be put in place to ensure orderly transition to the NCS. That this transition should not extend beyond the end of 2013;

"That the service providers should ensure that there is no skills gap in the NCS within the transition period. There should be harmonisation of training standards by all the service providers; that the NCS should recruit younger officers with requisite qualification in Physics, Chemistry, Mechanical Engineering, Electrical/Electronic Engineering and related disciplines for training on the use and maintenance of scanners and other specialised equipment and operation and that the government should ensure full implementation and enforcement of its trade policies and bilateral agreements as this will greatly enhance government revenue and good local economy.

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