A non-governmental human rights and development organisation, Human and Environmental Development Agenda (HEDA Resource Centre), has raised the alarm over President Bola Tinubu’s move to grant multinational oil companies, Shell Nigeria Plc and Eni Oil mining licence.
According to HEDA, President Tinubu is reported to be on the verge of granting Shell and Eni the oil mining licence as they have demanded for the offshore OPL 245 field which will throw Nigeria into a colossal loss.
HEDA recalled that former President Muhammadu Buhari had previously declined to issue the licence to the two multinational oil companies, pending the outcome of corruption trials related to their acquisition of the field in 2011.
HEDA said that “to ease the deal, in an exercise that effectively denies the conclusion of justice, Tinubu has already agreed to withdraw all OPL 245-related legal challenges against Shell and Eni.”
The organisation noted that most recently, a case against the two companies in the Nigerian Federal High Court collapsed after a lawyer for the Economic and Financial Crimes Commission (EFCC) announced that the anti-graft agency had no evidence to support a prosecution.
“The lawyer is now under investigation by the EFCC, which did not instruct him to make such a statement.
“No-one is suggesting that the companies and others accused nobbled the lawyer. But it is hardly a good look.
“The signal to the outside world is that the Tinubu government is giving up on the fight against corruption, which, by any measure, is the real cause of Nigeria’s economic and
political woes,” HEDA said a statement signed by Olanrewaju Suraju for HEDA Resource Centre, Antonio Tricarico for Italian ReCommon and Nicholas Hildyard for UK CornerHouse.
According to the organisation, “President Tinubu’s surrender to the companies is reported to have been motivated by a concern for Nigeria’s dire economic state.
“He is said to have been advised that Nigeria is losing $6 billion a year due to the delay in issuing an oil mining licence for the OPL 245 field.
“The $6 billion figure is fantasy – the Nigerian equivalent of the false promises on Boris Johnson’s Brexit bus.”
HEDA stated that if the 2011 deal stands, Nigeria will be denied any share of the profit oil from the field’s future exploitation.
It pointed out that an economic analysis by oil expert, Dr Don Hubert, estimated that over the lifespan of the project, Nigeria will get some USD 9.7 billion, or USD 500 million a year. Less than a tenth of what the Nigerian government is now fantasizing.
“Nigeria can only remedy its chances of benefiting from the licence if it exercises its right to “back in” to the project.
“But this will come at a huge cost. It will have to pay Eni and Shell an estimated $875 million, money it simply does not have. Even then, the government’s annual take would only rise to about USD650 million.
“These figures are likely overestimated. With the worldwide roll out of renewables, the economics of exploiting deep water fields like OPL 245 will be greatly affected, potentially transforming it into a stranded asset.
“The revenues to the government would be reduced as the commercially exploitable lifetime of the field is cut,” the organisation said.
It added that “The figures being touted by government sources to support a backdoor deal with Eni and Shell are so wide of the mark that questions need to be asked about the government’s motives.”
HEDA further alleged that “President Tinubu’s family connections to the oil industry are well known; his nephew co-founded the indigenous oil company OandO, which recently announced the purchase of elements of Eni’s Nigerian Agip Oil Company.
“But these connections should not influence President Tinubu’s Constitutional duty to act in the interests of Nigeria.
“To be sure, Nigeria needs income. But a decision to surrender to Shell and Eni, justified by intellectually untenable arguments, and abandoning the fight against corruption is not the way forward.
“Nigeria’s masses, none of whom have benefitted from the billions of dollars looted by Nigeria’s elite through oil developments, will again be the losers.”
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