Audit of 120 Oil Blocks Delays 2010 Licensing Round

Audit of 120 Oil Blocks Delays 2010 Licensing Round

The audit of about 120 oil blocks given out by the Olusegun Obasanjo administration to local and international investors in the licensing rounds held from 2005 to 2007 is responsible for the current delay in organising another oil bid round in the country.

Chairman of the Senate Committee on Petroleum (Upstream), Senator Lee Maeba, was quoted by Reuters as saying at the African Oil and Gas Conference in South Africa that the audit became necessary because the major targets of the previous bid rounds, which were to raise revenue, increase daily crude oil production and increase local participation in the industry, had not materialised.

“We are in the process of reviewing what we have achieved in previous bid rounds to decide whether we will hold another one or not. It depends on the review,” Maeba said.

Minister of Petroleum, Mrs. Deziani Alison-Madueke, had said that a planned licensing round of marginal oil blocks would take place this year but Maeba, however, said: “A decision on the timing of future oil licensing rounds was uncertain, pending the outcome of an audit of the previous auctions.”

According to him, the government had no specific date for when it expected to complete the audit.
He also said that companies who had not complied with their contractual obligations in the previous oil bid rounds would have their licences revoked and would be banned from participating in future auctions.
“The government is no longer taking this as a joke,” he said.

He, however, reiterated the determination of the National Assembly to pass the Petroleum Industry Bill (PIB) this year, to re-write Nigeria’s relationship with its foreign oil partners – the International Oil Companies (IOCs).

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