Again, Foreign Firms Corner Juicy Crude Oil Contracts
By Chika Amanze-Nwachuku, 02.08.2008
As it was the case under the government of Chief Olusegun Obasanjo, the majority of companies who have been awarded contracts for crude oil exportation in 2008 by the Nigerian National Petroleum Corporation (NNPC) are foreign companies, most of whom have no investments in Nigeria.
THISDAY investigations revealed that of the 28 companies granted approval to export between 30,000 and 60,000 barrels per day (bpd) of crude oil from April to December 2008, only seven have investments in Nigeria.
The companies that have investments in the country are: Addax and Sahara Energy who were allocated 60,000 bpd each. Others are: Camac, Oando, Dukeoil, Senegal and MRS.
The beneficiaries who do not have any investment in the country and who were allocated 60,000 bpd each are: Trafigura, Arcadia, Vitol, Glencore, Sinopec, and IOC. Others are TOR and Ivory Coast who were allocated 40,000 bpd each, while Petrodel, Tauraus, J&S, Gunvor, Pemex, Fujaira, Lanzing, Napoil, Calson, Nigermed, Isla Refinery, Sunoil and Petro Energy Refinery got 30,000 bpd each.
Eyebrows are being raised over the decision to continue with the award of the majority of the lucrative contracts in the oil industry to foreign companies in the face of fierce agitations in the Niger Delta over lack of adequate local participation in the oil sector.
Many analysts and industry experts, both local and foreign, have often attributed the intractable crisis and militancy in the oil-producing region to the issue of foreign domination.
The Obasanjo government had initiated the Local Content policy to increase indigenous participation in the all-important sector and consequently directed oil companies operating in the country to commence in-country fabrication of equipment as well as other major components used in oil exploration.
The government had also reasoned that the implementation of the content policy would serve as a means of dissuading capital flight and help develop local capacity building in the Nigerian Oil and Gas sector, to enable Nigerians participate actively.
But the NNPC has continued to award crude oil contracts to companies who are neither players in the industry nor have any form of investment in the country.
The criteria for the award of the latest contracts were not made public. Under Obasanjo, only companies with a minimum of $5 billion annual turnover were consider – a policy that knocked off Nigerian companies.
For the period covering January to March 2008, for instance, 42 companies were given contracts to export between 10,000 and 60,000 bpd of crude oil. Twenty-five of the beneficiaries who are traders are; Addax, Arcadia, Glencore, Vitol and Trafigura, who were given approval to export 60,000 bpd each while Petrodel, Sterling Oil Resources, Sahara Energy Resources, Gembrook Energy Limited, J & S Inv. Services Ltd, Team Trade International (Lukoil), Amg Petro-Engery Ltd, Kingsbury Trading, Ommart Ltd, Roger Princeton Ltd, Global Gas & Energy Ltd, World Wide Energy, Dainom Nig. Ltd, Macau Ltd, Tacorr, Elan Oil Ltd, Alphapetro World Wide, Attock Oil, Abacus Oil and Phenoil Ltd were granted approval to export 30,000 bpd each, totaling 900,000 bpd.
In the category of refineries were: Gunvor Trade International, which was allocated 60,000 bpd, while four others, Kyokuto, Pemex Refinery, North Atlantic Refinery and Fujairan Refinery were allocated 30,000 bpd each, totaling 180,000 bpd.
The beneficiaries under the Nigerian National Petroleum Corporation were: Dukeoil, Napoil, Calson and Nigermed, who were allocated 30,000 bpd each for January to March, while the beneficiaries under bilateral relationship were Sinopec and Sao Tome who got 60,000 bpd and 30,000 bpd respectively.
Taurus Petroleum Ltd, TOR (Ghana), TOR Logistics, IOC, Senegal and Cote D’Ivoire, also categorised under refineries were awarded 30,000 bpd, 30,000 bpd, 10,000 bpd, 60,000 bpd, and 30,000 bpd respectively, which totaled 280,000 bpd for January to March.
•In our front page story last Tuesday, we inadvertently stated that between 200,000 and 300,000 barrels of crude oil are estimated to be stolen or unaccounted for per annum. In fact, the figures represent daily loss.
