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Reps Threaten to Recommend Revocation of Oil Licences

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  • Reps Threaten to Recommend Revocation of Oil Licences

An ad hoc committee of the House of Representatives on Tuesday threatened to recommend the revocation of various controversial Oil Prospecting Licenses and Oil Mining Leases awarded by the Federal Government.

An estimated $1.75bn in revenue is said to be owed the government by winners of oil well bids.

The committee became increasingly frustrated after it turned out that government agencies, particularly the Department of Petroleum Resources, were unwilling to provide information on the payment of royalties, signature bonuses, application fees and other dues by owners of the oil wells.

The committee, which is chaired by a member from Kaduna State, Mr. Gideon Gwani, is investigating alleged breaches of due process in the award of the oil blocks to select companies and individuals.

Earlier on Monday, the DPR, the Nigerian National Petroleum Corporation and Central Bank of Nigeria failed to produce documents on the funds derived from the wells.

On Tuesday, the DPR again was unable to furnish the committee with evidence of the presidential approvals for the wells.

Many wells were awarded through the discretionary powers of the President as exercised by the Minister of Petroleum Resources.

But, asked to produce the approvals, the DPR officials made excuses before the committee.

Two well owners, Oriental Energy and Platform Petroleum, were also unable to furnish the committee with information on the presidential approvals.

In addition, Platform Petroleum admitted to have not fully paid its royalties for 2016.

Gwani threatened, “Those who failed due process tests and whose licences to operate came through processes other than those prescribed by the law, we will recommend that such licences be revoked, relinquished and thrown back into the basket for Nigerians to bid for properly.

“In the course of this investigation, we found out even today that a company refused to pay royalties for the whole of 2016. This is a fee that is supposed to be paid monthly.

“As such, it is important that the DPR begins to enforce the (Petroleum) Act, since it is clear that any company that failed to do business in accordance with the Act by not paying the requisite fees as and when due, that company’s licence will be relinquished and the block taken away.”

He added, “We are looking at the process by which these licences were acquired because we found out that the process might have been abused.”

“It could be that someone in government was doing business with the issuance of these licences to themselves and their cronies by manipulating presidential assent. We found out that languages that were not presidential were used in some of these letters of award.

“That has given the committee an idea of how things were manipulated and that is why we want to take it further by finding out the owners of these companies from the Corporate Affairs Commission.”

On further actions the committee would take, he stated, “This committee is determined to expose any oil company that did not get its licence right and we will recommend it for revocation.

“Revocation of such licences will even be good for the country as it will provide the opportunity for our Niger Delta oil and gas investors to partake in the new bidding process.

“Personally, my believe is that if we have more Niger Delta investors in the sector, then agitation and vandalism of oil assets will be reduced, knowing that they have a greater stake in the sector.”

Last week, the committee named many OPLs and OMLs, whose proceeds had not been accounted for by the affected government agencies.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Portland Paints, Chemical and Allied Products Plc Agreed to Merge

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Portland Paints

Portland Paints, Chemical and Allied Products Plc Agreed to Merge

Portland Paints and Products Nigeria Plc and Chemical and Allied Products Plc have agreed to merge, according to the latest statement from both companies.

In a statement released through the Nigerian Stock Exchange, the Board of Directors of CAP said we are “pleased to inform you that following discussions and negotiations, the Boards of CAP and Portland Paints have reached an agreement to undertake a merger between both entities (the “Merger” or the “Proposed Merger”).

Accordingly, we “hereby present to you the terms and benefits of the Proposed Merger for your consideration and seek your support and approval to effect the Proposed Merger.

“The Proposed Merger presents a compelling opportunity to create significant value for shareholders of CAP and achieve the company’s strategic growth objectives as a larger company with a broader product portfolio, more corporate owned brands and diversified revenues.

“The resultant entity is also expected to benefit from enhanced distribution capabilities in addition to economies of scale and operational efficiencies.”

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

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Tony Elumelu Acquires Shell, Total, ENI Stakes in OML 17

Tony Elumelu owned Heir Holdings Limited and its related company Transnational Corporation of Nigeria Plc on Friday announced it has completed the purchase of 45 percent stake in Oil Mining Lease (OML 17) through TNOG Oil and Gas Limited.

The acquisition includes all assets of Shell Petroleum Development Company of Nigeria Limited (30 Percent), Total E&P Nigeria Ltd (10 percent) and ENI (five percent) — in the lease.

It was further stated that TNOG Oil and Gas Limited will also have the sole right to operate OML 17.

The field presently has a production capacity of 27,000 barrels per day. Also, there are estimated 2P reserves (proven and probable) of 1.2 billion barrels and an additional one billion barrels in possible reserves — all of oil equivalent.

A consortium of global and regional banks and investors provided a financing component of $1.1 billion for the largest oil and gas financing in Africa in over a decade.

In a statement released on Friday, Shell said the completion was after all the necessary approvals have were received from authorities.

“A total of $453m was paid at completion with the balance to be paid over an agreed period. SPDC will retain its interest in the Port Harcourt Industrial and Residential Areas, which fall within the lease area,” the SPDC said.

Speaking after the completion of the deal, Elumelu said “We have a very clear vision: creating Africa’s first integrated energy multinational, a global quality business, uniquely focused on Africa and Africa’s energy needs. The acquisition of such a high-quality asset, with significant potential for further growth, is a strong statement of our confidence in Nigeria, the Nigerian oil and gas sector and a tribute to the extremely high-quality management team that we have assembled.

“As a Nigerian, and more particularly an indigene of the Niger Delta region, I understand well our responsibilities that come with stewardship of the asset, our engagement with communities and the strategic importance of the oil and gas sector in Nigeria. We see significant benefits from integrating our production, with our ability to power Nigeria, through Transcorp, and deliver value across the energy value chain.

“I would like to thank Shell, Total and ENI, for the professionalism of the process, the Federal Government of Nigeria, the Ministry of Petroleum Resources, and the NNPC for the confidence they have placed in us.”

Tony Elumelu is the Chairman of Heirs Holdings Limited, Transcorp and United Bank for Africa Plc.

Also, read Transcorp Plc Acquires FGN’s 100% Equity in Afam Power for N105 Billion

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Exporters Say CBN Pre-export Requirements is Frustrating Export of Goods

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Exporters Say CBN Pre-export Requirements is Frustrating Export of Goods

Exporters have said the recently introduced pre-export requirements by the Central Bank of Nigeria is creating unnecessary bottlenecks for exporters and the movement of goods out of the country.

Exporters, who spoke under the aegis of the Network of Practicing Non-oil Exporters of Nigeria (NPNEN), said the electronic Nigeria Export Proceed Form now required by financial institutions from exporters had come with so many challenges.

Ahmed Rabiu, the President, NPNEN, explained that the new policy had several requirements that often led to delays and loss of income on the part of exporters.

He said, “We acknowledge the CBN’s desire to ensure that all exports out of Nigeria are documented in order to ensure that the proceeds of such exports are repatriated.

“However, the reality on the field shows that the process is causing undue delays and consequently, encouraging corruption.

According to them, in the new pre-export requirements, the Central Bank of Nigeria wants an export transaction to be initiated through eNXP processing on the trade monitoring system.

After which exporters are expected to have a pre-shipment inspection agent, the Nigeria Customs Service and other designated government agencies carry out their pre-export inspections.

The exporters said the pre-shipment inspection agent was expected to issue a clean Certificate of Inspection while Customs would issue the Single Good Declaration. All these they said takes time and delay goods from leaving the country on time.

Pointing to a recent report, they said about N868 billion worth of goods bound for export were stuck at the ports due to the new policy.

Speaking further Rabiu said, “For example, for the PIA to issue the CCI, the exporter is required to upload a certificate of origin as one of the supporting documents for the eNXP.

“The PIA is also required to upload the CCI to the TRMS(M) and until this is done, the Customs service will not issue the Single Good Declaration.”

He added, “After issuing the SGD, the customs is further required to upload it into the TRMS before the goods are allowed to be gated into the port and loaded on the vessel by the shipping line.

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