The Nigerian Upstream Petroleum Regulatory Commission (NUPRC ), headed by Engr. Gbenga Komolafe has come under intense criticism at the National Assembly for alleged revocation and wrongful reallocation of Atala Marginal Oil field ( OML 46) owned by Bayelsa State Government to another firm, Halkin Exploration and Production Company Limited ( Halkin E&P).
Irked by the wrongful allocation, the Nigeria Senate has mandated its Committee on Ethics, Privileges and Public Petitions to probe the matter.
The committee, headed by Senator Ayo Akinyelure, acting on a petition before it from Bayelsa Oil Company Limited ( BOCL) and Hardy Oil Nigeria Limited has directed Komolafe, the Chief Executive of NUPRC, to produce written directive from President Muhammadu Buhari, who doubles as the Minister of Petroleum Resources, authorising the revocation and subsequent allocation of the field to Halkin E&P.
It was learned that trouble started on April 6, 2020 when the now defunct regulatory agency, the Department of Petroleum Resources ( DPR), revoked the operating licence of BOCL on the Marginal Oil Field, citing lack of assets to turn around for the nation in deriving maximum value from available resources therein.
The committee, had in March this year , hosted the disputants at a public hearing for way out of the complicated matter. Consequently, the trio of BOCL, Hardy Oil Nigeria Limited and Century Exploration and Production Limited ( CEPL) which kicked against the revocation, said that as original operators of the oil field, explorations and productions have been made and royalties paid into account of the federal government of Nigeria .
The trior said that as at the time the field was purportedly revoked, the JV-partners have an outstanding 20,700 barrels of crude on the site. Following the protest, Governor Douye Diri of Bayelsa State resolved to seek legal redress in overturning the revocation especially in consideration of the resources already committed to the oil field by the Bayelsa state government as owners of 51% equity .
In October 2020, President Muhammadu Buhari had directed the then DPR to immediately “reinstate the revoked licences on a discretionary basis to qualified companies with consideration given to the previous operators of the respective fields subject to the demonstration of technical/financial capacity and payment of applicable Good and Valuable Consideration (GVC).”
The then DPR Director, Auwalu Sarki, flouted the President’s directive, and awarded the oil field tto differebt firm – Halkin Exploration and Production Limited, which was not among the previous operators, prompting the operators to petition the Senate Committee on Ethics, Privileges and Public Petitions. Auwalu, in a letter dated February 28, 2021, reallocating the oil field, claimed he acted on the directive of the Minister of State for Petroleum, Chief Timipre Sylva.
Dr. Kelechi Ofoegbu, the Executive Commissioner, Economic Relation and Strategies, represented Komolafe at the investigative hearing conducted by the Senate Committee on the matter.
The Senate Committee, which berated Ofoegbu following his insistence that the action was inherited from the defunct DPR.
The committee had noted that the Presidential Directive which favoured previous operators was not followed in the discretionary action taken by DPR.
“NUPRC which is now the new regulatory agency that you represent here, is not expected to take side on the disputed oil field”, the committee declared.
It added: “Since DPR is inherited by NUPRC, the new agency, must furnish this committee with written directive from President Buhari, upon which award of the Atala Oil Field was made to Halkin E&P and not previous operators as clearly stated in the presidential directive quashing the revocation. Perhaps , in running away from the fact and getting away with the oil field award , Halkin stopped appearing before this committee after previous appearances by resorting to litigation in the court of law. What this committee wants from NUPRC being the inheritor of DPR , is written Presidential directive on the oil field award to Halkin E&P and nothing more
”It is wrong for an implementing agency to hide under discretion , in violating Mr President’s clear cut directive. DPR which is now NUPRC must provide written Presidential directive on the Atala Marginal Oil Field it awarded to Halkin with attendant enormous financial loss inflicted on previous operators , one of which had invested $60million in it as contained in documents before us.”
The Committee lambasted Kelechi when he interjected by dismissing the $60million invested not to be on oil exploration by any of the previous operators but on equipment. Members of the Committee declared that $60million invested on equipment clearly showed the competence and capability of the operators to handle the oil field.