DPR Set to Handover Addax Assets to New Owners, Sets Up Evaluation Panel

By Emmanuel Addeh

Following the federal government’s revocation of the Production Sharing Contracts (PSCs) on four assets belonging to Addax Petroleum Exploration Nigeria Limited (APENL), the Department of Petroleum Resources (DPR) has announced the kick-off of processes that will lead to the handing over of the facilities to new owners.

The oil and gas industry regulator stated Thursday that a committee has already been set up in preparation for the formal ceremony culminating in the takeover by the new operators, Kaztech/Slavic Consortium, after it was taken from the erstwhile owners.

A statement issued by the Head, Public Affairs of the agency, Mr. Paul Osu, said the committee was inaugurated in Abuja on Wednesday by the Director of the DPR, Mr. Sarki Auwalu.

The DPR director stated that the move was in fulfilment of the federal government’s commitment to reactivating all moribund oil and gas support facilities across the country.

According to him, it was also aimed at stimulating the economy and creating job opportunities for Nigerians.

Auwalu charged the committee to evaluate the current status (as-is) of the revoked assets, including liabilities post revocation, in order to facilitate takeover of the assets by the newly appointed operators of the assets.

He advised the committee to discharge the responsibility entrusted on them by the nation with all sense of patriotism and dedication to national interest and gave the panel one week to conclude the assignment.

The DPR recently said it revoked the four assets of Addax Petroleum Exploration Nigeria limited namely OML’s 123, 124, 126 and 137, due to the non-development of the assets by the company.

Auwalu revealed that the government had awarded the assets to KEL/Slavic consortium, said to consist of two Nigerian-owned independents with the approval of President Muhammadu Buhari.

The director noted that the government’s action was prompted by Addax’s failure to operate the facilities and thereby not adding value to the assets, a development he likened to sabotage.

He said over 50 per cent of the assets under Addax’s control were undeveloped and were not being operated “in a vigorous manner and that constitutes revenue loss to the government”.

Auwalu added that the average reserved assets remained flat underlining the fact that activities around the oil blocs had not been improved upon.

The DPR chief also said that investigation overtime, equally revealed that crude oil production around the oil blocs had been declining due to inadequate investment, insisting that Addax was never known to have supplied gas to the domestic gas market.

“It is the outcome of the regular interactions that have led to this action which makes it necessary for us to recommend to government to take this necessary action. The licence has been awarded to a new consortium that will assume the new assets on the same terms,” he had stated.