Senate Backs President Buhari On Re-Allocation Of Atala Oil Field

The Senate has backed President Buhari on re-allocation of Atala oil field.

The Punch reports that the Senate has faulted the revocation of Atala Marginal oil field (OML 46) in February 2020 by the Department of Petroleum Resources, now Nigerian Upstream Petroleum Regulatory Commission.

It consequently ordered the commission to reallocate the oil field to its original owners as earlier directed by the Presidency.

Senate’s resolutions were sequel to recommendations made to that effect by its committee on Ethics, Privileges and Public Petitions.

The Senator Ayo Akinyelure-led committee had on the mandate given by the Senate, investigated petitions forwarded to it by Daniel Chukwudozie on behalf of Hardy Oil Nigeria Limited, Bayelsa Oil Company Limited, Century Exploration and Production Limited against NUPRC for alleged illegal and fraudulent revocation of Atala Marginal Field ( OML 46) and its re-award to Halkin Exploration and Production Limited.

The award of the Oil field to Halkins as stated in the petition was a breach of due process and Presidential Directive.

The committee after several months of interface with all the interested parties on the oil field recommended to the Senate that it should be – allocated to original owners who are Hardy Oil Nigeria Limited, Bayelsa oil Company Limited and Century Exploration and Production Limited.

The adopted recommendation of the committee by the Senate reads, “Since the revocation of the Atala Marginal Field ( OML 46) was based on misleading information supplied by Halkin Exploration and Production Limited and since NUPRC was unable to produce written evidence that President Muhammadu Buhari actually reversed his initial directive on consideration of owners/operators of Atala Marginal Field for re-award as claimed by NUPRC, the committee strongly recommends that the oil field be returned to its original owners/operators.

“This recommendation is in line with Presidential directive which was applied in returning the Nine marginal fields to their original owners/operators.”

Prior to the Senate’s resolutions, the President, Major General, Muhammadu Buhari, (Retd.) had in October 2022, ordered NUPRC, to reallocate the oil fields to the original owners since Halkins was not even a registered company when Hardy Oil Nigeria Limited, Bayelsa Oil Company Limited and Century Exploration and Production Limited, developed the oil field from 2014 to 2018 and acquired the license for its exploration.

Halkin Exploration and Production Limited as clearly stated in the petition and listed in the records of the Corporate Affairs Commission, became an incorporated company on September 9, 2019.
Controversies started over the oil field on April 6, 2020, when the then regulatory agency, the Department of Petroleum Resources, revoked the operating license of BOCL on the marginal oil field over an alleged lack of assets turnaround for the nation.

But the trio of BOCL, Hardy Oil Nigeria Limited, and Century Exploration and Production Limited kicked against the revocation on the grounds that as original operators of the oil field, explorations and productions had been made and royalties paid into the account of the Federal Government of Nigeria and that as at the time the field was purportedly revoked, the JV-partners had an outstanding 20,700 barrels of crude on the site.

Governor Douye Diri of Bayelsa State, in the heat of the protest, resolved to seek legal redress in overturning the revocation, especially in consideration of the resources already committed to the oil field by the Bayelsa State government as owners of 51 per cent equity.

On the strength of the protest, the President, Major General, Muhammadu Buhari (Retd.), in October 2020, directed the immediate “reinstatement of the revoked licenses on a discretionary basis to qualified companies with consideration given to the previous operators of the respective fields subject to the demonstration of technical/financial capacity and payment of applicable Good and Valuable Consideration.”

But the then DPR, through a letter dated February 28, 2021, signed by Auwalu Sarki, reportedly on behalf of Minister of State for Petroleum Resources, Timipriye Sylva, awarded the oil field to Halkin Exploration and Production Limited, which was not among the previous operators, leading to petitions filed against it to the Senate Committee on Ethics, Privileges and Public Petitions by the shut out operators.