How Department of Petroleum Resources Illegally Awarded Oil Mining Lease to Halkin Oil, Despite Buhari’s Directive –Senate Findings
The Nigerian Senate is investigating how OML 46 was illegally awarded to Halkin Exploration and Production Company Limited, by the defunct Department of Petroleum Resources (DPR), in contravention of the presidential directive.
The Senate Committee on Ethics, Privileges and Public Petitions, while interfacing with the groups involved at a public hearing on Tuesday, 22nd March 2022, was informed that, after the revocation of the oil field, the presidency intervened, considered the numerous petitions from the various marginal owners and directed that the fields be rewarded on a discretionary basis with preference to the previous owners, including the Atala Oil Field.
The public hearing followed a petition brought before the Senate dated the 5th October 2021, by Sir Daniel Chukwudozie, on behalf of Hardy Oil Nigeria Limited (HONL), against the DPR, for alleged breach of trust, corruption and illegal revocation of OML 46 and re-awarding same to Halkin Exploration and Production Company Limited, in breach of due process.
During the public hearing which was the third in the series, the representative of Hardy Oil, Barr. Ike Onwuchuluba, adopted its presentation dated 24th September 2021, in addition to the annexed documents that the company submitted to the Committee.
He submitted that the subject matter of the petition bordered on the OML46 – Atala Marginal Oil Field and the improper way and manner the field that was formerly managed by the trio of Bayelsa Oil Company Limited (BOCL), Hardy Oil Nigeria Limited and Century Exploration and Production (CEPL), was revoked and handed over to a company in very shady and fraudulent circumstances, ipso facto.
He noted that Halkin Exploration and Production Limited invested $60,000,000 ($60 million) in the Atala Marginal Field and executed a Farm-In Agreement with BOCL.
Debunking the allegation that there was an investment of $60 million and acquisition of 41 percent shares of BOCL by Halkin Exploration and Production Company Limited, Hardy Oil Nigeria Limited said: “The allocation of the field to Halkin Exploration and Production Company Limited was done and secured under fraudulent misrepresentation made by Halkin.”
Onwuchuluba also told the Senate that the award, which was predicated on two reasons by the defunct DPR was false, adding that Halkin Exploration and Production Company Limited was an unknown entity to the former Atala Marginal Field owners.
“They did not invest any $60m in the field, did not execute any Farm-in Agreement with BOCL and that Halkin Exploration and Production Company Limited secured OML 46 under false pretence/misrepresentation,” he added.
He also informed the Committee that the man who presented himself as the Managing Director (MD) of Halkin Exploration and Production Company Limited was the immediate past MD of Bayelsa Oil Company Limited as at the time the field was given to Halkin and stands conflicted by holding such dual positions.
“Which means that he was on one leg the MD of BOCL and on another leg the MD of Hakin. So, it is not impossible that he may have used his position as the MD of BOCL to alter documents to the benefit of Halkin. And that the failure of DPR to verify the claims of Halkin from the Atala JV Partners was in breach of the principle of a fair hearing,” he submitted.
While emphasising that the re-awarding of OML46 was under false pretence and to an unknown entity, Ike Onwuchuluba called the attention of the Senate to the fact that the Atala Marginal Field was developed between 2014 to 2018 by the trio of BOCL, Hardy Oil Nigeria Limited and Century Exploration and Production Ltd whereas Halkin Exploration and Production Company Limited which claimed to have invested $60m in the Atala Marginal Oil Field, was incorporated sometime on the 29th September 2019, long after the field has been developed by the parties.
He further reminded the Committee that, as the original owner of the Oil field, the trio of BOCL, Hardy Oil Nigeria Limited and Century Exploration and Production Ltd have been producing and paying royalties to the account of the federal government of Nigeria and that as at the time the field was purportedly revoked, the JV-partners have an outstanding 20,700 barrels of crude on the site.
He, therefore, requested that the Senate should look into the matter and urge Nigeria Upstream Petroleum Regulatory Commission (NUPRC) to immediately reinstate Atala Marginal Oil Field OML 46 to the joint venture that owns the Oil field.
In its submissions in support, the Managing Director of Bayelsa Oil Company Limited, Mr. Bello Akpoku stated that:-
“We have availed the Committee with the Memo written to the Honorable Minister of Petroleum Resources, whereby the defunct Department of Petroleum Resources (DPR) stated that the field was allocated to Halkin Exploration and Production Company Limited for two principal reasons namely; that Halkin Exploration and Production Company Limited claimed to have invested $60m to the Atala Marginal Oil Field and second was the alleged acquisition of 41% share of Bayelsa Oil Company Limited shares in the Atala Marginal Oil Field”.
He maintained that “BOCL owned 51% in the Atala Marginal Field and Halkin Exploration and Production Company Limited claim to have acquired 41% of the 51% share thereby making it the largest partner owner of the field is false”.
When he was called to react to the allegations made against him and his company, the MD of Halkin Exploration and Production Company Limited, Mr. Charles Dorgu, who could not put up a defence, claimed to be sick and urged the Committee to give him two weeks extension to come up with his defence to the weighty allegations.
The visibly infuriated Senate Committee, on its part, called on the Nigeria Upstream Petroleum Regulatory Commission (NUPRC) to interface with the groups involved and look into the matter critically and report back to them in two weeks.
The lawmakers also frowned at the refusal of Mr. Dorgu to honour their invitations for two consecutive times previously and how he made some fruitless efforts to stop the Committee from hearing the petition by resorting to litigation against the National Assembly.
The Chairman of the Committee, Senator Ayo Akinyelure, thereafter directed the MD of Halkin to provide documented evidence of how the shares were acquired and evidence of the $60million investment, if actually such were made in its submissions to NUPRC.