Minister of State for Petroleum Resources, Heineken Lokpobiri, has confirmed that negotiations are ongoing to finally end the disputes surrounding OML 245 so the block can resume production in the national interest.
The President, Bola Ahmed Tinubu, had directed the Attorney-General of the Federation, Lateef Fagbemi, the Minister of State for Petroleum Resources, and other government agencies to clear all court cases related to the $1.3 billion deepwater OML 245 oil block located in the southern Niger Delta.
Other agencies that also received the order include the Economic and Financial Crimes Commission, Nigerian Upstream Petroleum Regulatory Commission, and Nigerian National Petroleum Company Limited.
Lokpobiri disclosed this in Abuja on Wednesday, revealing that parties involved in the deal are currently negotiating to end the over 28 years of crisis and litigation surrounding the prolific oil block within the next month.
The Malabu OML 245 deal, considered one of Nigeria’s most prolific oil blocks, was acquired by Malabu Oil and Gas, a company with links to former Nigerian Minister of Petroleum, Dan Etete, in 1998 for $2 million. In 2001, the federal government under former President Olusegun Obasanjo revoked Malabu’s license due to “questionable practices.”
In 2006, Malabu challenged the revocation in court, eventually reaching an out-of-court settlement with the government under former President Umaru Yar’Adua.
In 2011, Shell and Eni, two major oil companies, acquired the block for $1.3 billion from Malabu in a deal approved by the Nigerian government. However, since then, there have been allegations and litigation, as Transparency International and other anti-corruption groups alleged bribery and corruption in the deal.
Commenting on the situation, Lokpobiri said there is an urgent need to boost investment in the oil sector to avert an imminent economic crisis.
He said, “With just a five percent reserve investment ratio in our oil sector, which is the lowest globally in the last five years, there is an urgent need to boost our investment in the sector to avert an imminent economic crisis. If we resolve all issues around OML 245 and other oil wells, with our investment friendliness, it will attract investments running into billions of dollars, potentially changing the narrative significantly.”
He added, “The matter concerning OML 245, a significant oil block within our nation’s territory, has been subject to various litigations and discussions across different jurisdictions. It is essential to understand the intricacies of the agreements and the efforts invested in resolving the disputes surrounding this block.”
The minister stated that the core issue revolves around the agreement between the federal government, Shell, and ENI, wherein the Federal Government facilitated the transfer of rights from Malabu to Shell/ENI in exchange for consideration. This process was conducted transparently and in accordance with established legal frameworks.
He maintained that throughout the legal proceedings, there has been no evidence indicating any criminal liability on the part of the federal government or any involved parties, as all legal battles across multiple courts have concluded with outcomes affirming the absence of criminal wrongdoing.
“On the complexity surrounding OML 245, President Bola Ahmed Tinubu has demonstrated astute leadership by directing efforts towards resolving the lingering issues. Meetings and discussions have been convened with stakeholders from various countries, including the Netherlands, the UK, and Milan, to explore avenues for an amicable resolution.
“Let me stress that President Bola Ahmed Tinubu’s interest remains the transformation of our vast natural resources into prosperity for the nation. We have continued to leverage the positive impact of the PIA and the mutually beneficial policies of the President Bola Ahmed Tinubu-led Federal Government to attract prospective investors, but we all must be patriotic in supporting these pursuits. We must remain patriotic in our statements and continue to build faith in the #Renewed Hope administration because the President has good intentions for the nation and has supported the resolution of all issues around OML 245,” Lokpobiri said.
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