Nigeria's new government is reviewing award of oil blocks in last couple of years expressing apprehensions that the licences won by India's ONGC-Mittal combine may also be under scanner.
RIYADH: Nigeria's new government is reviewing award of oil blocks in last couple of years after it received complaints of irregularities in their allotments, with some quarters expressing apprehensions that the licences won by India's ONGC-Mittal combine may also be under scanner.
"We are reviewing award of blocks by the previous government... There were complaints about the procedure used in award of some of the blocks and we are now investigating that," Nigeria's Minister of State for Energy (Petroleum) Odein Ajumogobia said on the sidelines of OPEC Summit here.
Although the identities of the blocks as well as the awardees are not immediately known, industry sources said some domestic and foreign entities that obtained licences to explore oil in the energy-rich African nation through 'back door' may end up losing them.
"I dont remember if the (two) blocks awarded to ONGC-Mittal (combine) is also under review," Ajumogobia said when asked if ONGC Mittal Energy Ltd's (OMEL) Block 285 and 279 were under scanner.
OMEL, an equal joint venture of state-run Oil and Natural Gas Corp (ONGC) and steel baron Lakshmi N Mittal, had in 2005 won rights to explore in OPL 279 and OPL 285 after committing to invest six billion dollars in a 1,80,000-barrels per day greenfield refinery, a 2,000-MW power plant and a railway line from East to the West of Nigeria.
OMEL paid a signature bonus of 50 million dollars for OPL 285 and 75 million dollars for OPL 279.
In a subsequent licencing round, which happened just before elections that saw a new government, OMEL was given preferential bidding rights for yet another block (OPL 250) but it did not submit any bid.
Preferential bidding rights are kind of first right of refusal where the company can match the highest bid for the block and bag the exploration acreage.
Mittal, sources close to the steel baron say, is not keen on taking more exploration acreage in Nigeria. Foreseeing a change in the government in Nigeria, he decided to limit his exposure in the African state.
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