Director and Chief Executive Officer of The Department of Petroleum Resources (DPR) Engr. Sarki Auwalu has said that DPR revoked three Oil Mining Licences belonging to Addax Petroleum citing non-performance of the assets for several years.
He said that as a result of the lack of investment by Addax in the oil wells Nigeria was losing money that would have accrued to the nation if the asset were performing. He also said that the company flagrantly disregarded the government gas master plan and was flaring the asset with impunity. The revoked licenses include OML 123, 124, 126 and 137.
In a chat with Association of Business Editors in Nigeria, Sarki Auwalu said that the decision was taken in a bid to address production and revenue losses occasioned by the continued neglect of the assets. According to him, over 50 per cent of assets remain undeveloped after several years, contrary to the principle of Petroleum Act.
Auwalu said that OML 137 holds gas reserves of more than 3trillion tcf, adding that reserves have remained flat over the years without any form of development. Addax Petroleum had declared a force majeure on its operations in 2015, affecting the Antan project.
Auwalu further said that the revoked licenses have been rewarded to Kaztec and Salvic Consortium after following due process based on the same terms and conditions given to Addax.
He added that Addax was found culpable for significant gas flaring even though it never supplied gas to the domestic market. He also said that crude production from the revoked assets has been declining over the years due to lack of investment by Addax in the revoked assets. He said that by re-awarding the assets to a consortium they will be revamped for the benefit of Nigerians.