31-07-08 For selling a national asset for mere pittance, the House of Representatives Committee probing the oil sector may resolve to recommend for prosecution officials of the Nigerian National Petroleum Corporation and Directorate of Petroleum Resources (DPR).
The issue at stake is the sale of oil block OML 65 which was later renamed OPL 298 for $ 5 mm, after the Nigerian Petroleum Development Company had invested $ 2 bn on the development of the block, to the Chinese National Petroleum Company (CNPC).

This came on a day the immediate past Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) and former Special Assistant to former President Olusegun Obasanjo on Petroleum Matters, Engineer Funsho Kupolokun, admitted before the House Committee that the revocation of OPL 242 was carried out in error.
The Committee berated the NNPC for allegedly selling off a national asset for $ 5 mm when the OML 65 was already producing so much and the NPDC had invested over $ 2 bn in the block.

Co-chairman of the committee, Leo Ogo said: "They all collaborated with the NNPC, the Chinese, and the NPDC to sell a national asset. Our secondary interest is the national asset. You people knew what you are doing. The well sold for $ 5 mm. I will not be a part of this. The parliament will not be part of it. It is a shame that people entrusted with national assets should fritter it away for a pittance. We will call for prosecution of the parties".
"There is a massive disconnection between the NNPC and the DPR. There is a great national disservice. The NPDC man has been misleading this House on a wild goose chase. There is a confidentiality agreement and he has never seen the document".

The Chinese company, however, stated that China National Petroleum Company won the block OPL 298 and OPL 471 during the 2006 Nigeria mini bid round held by DPR and signed the corresponding Production Sharing Contracts in the name of its subsidiary CNODC with the NNPC on April 23, 2007 and was ratified by the Minister of Energy and took effect the same day.
The company however said that "for the purpose of initiating the petroleum operation, we have continually applied to the NNPC for the transfer of the related data and facilities and the control of the block. We equally asked for the President's attention through the Chinese Ambassador to Nigeria on March 2008 unfortunately our request was refused without any excuse".

The officials of the CNODC also stated that: "The letter contained that we should go to OML 65 and start work and I am here to submit that letter. Mr Adeyemo was the Executive Director of NPDC at that time and we even collected data from them. Secondly, the issue of signature bonus we paid was $ 30,100,000 m. There is a downstream commitment for a refinery and there was no lead time."
Kupolokun, who was interfacing with the committee for the third time in three days at the National Assembly said, "Mr Chairman you would need to protect me. The madam came with what Kupolokun did. I did what I consider the best thing to be done under the circumstances. Obekpa put up for the bid and won fair and square, they had a partner that was to pay for the block. DPR recommended to me and I checked but was not satisfied with what I saw".

"Obekpa's partners were in shallow waters and I could not pair them in deep waters. We were trying to bring in Petrobras and Petronas. They put in for three blocks and lost. We had Obekpa's partner not financially strong. I recommended to Mr President that we should pair Obekpa with Petronas. And Mr President concurred. I got a call from the VP of Petronas and found at they could not play in the business and I asked them to put it in writing", he said.
"Then came CREP together with Obekpa and I asked them to work together and they agreed. We now said Ocean Energy should have 75 %, Obekpa 12.5 %and CREP 12.5 %. I saw the letter of revocation."

"The DPR should know what transpired. If DPR had advised me that would not have happened."
"We agreed that the revocation was done in error because DPR did not advise me correctly. If they have, I don't think that they would have been revoked".