The Department of Petroleum Resources (DPR) has assured stakeholders that their equity and economic interests will be protected when Pan Ocean Oil Corporation (Nigeria) Limited hands over oil minining lease (OML) 98 to the Nigerian Petroleum Development Company (NPDC) Ltd.
This assurance was given at a meeting involving representatives of the Nigerian National Petroleum Corporation (NNPC), DPR, NPDC and Pan Ocean, as part of the asset handover process.
The DPR in June last year revoked Pan Ocean’s OML 98 licence over issues bothering on royalty payments. Over the last eight months, Pan Ocean has been working hard to ensure smooth transfer of the asset.
Assuring stakeholders that the midstream assets on OML 98 and those associated with the Mining Lease will continue to deliver value to stakeholders, Director, DPR, Engr. Sarki Auwalu, said outstanding operational costs incurred by the NNPC/Pan Ocean JV will receive due attention after verification.
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He directed the NNPC/Pan Ocean JV to sort out members of staff associated with the asset while pointing out that legacy debt on the asset will be settled amicably, exploring available options, without recourse to legal steps.
Engr. Auwalu said: “The equity and economic interests of all investors are recognised. We will ensure that no one is short-changed. Everyone will recoup their investments on all the assets and no investor will be discouraged.
“Pan Ocean must work together with the new owner of OML 98, especially on the midstream assets. OML 98 cannot be operated efficiently and profitably without the midstream assets.”
He promised that a letter will be delivered to Pan Ocean in the next few days to assure the company about the security of its assets and equity.
While reassuring the regulators of Pan Ocean’s commitment to a smooth transition, Mr. Olajide Ishola, Chief Operating Officer, Pan Ocean said: “Since last year when the revocation of the asset came into effect, a lot of things were left in limbo. This meeting set the tone for the handover and future of the asset. In the months ahead, we will continue to work closely with regulators to ensure that there is no significant disruption in production as a result of change in ownership.”
Pan Ocean has engaged in economic activity on OML 98 since 1973. Within the period, the company created jobs, contributed to the development of critical national oil and gas assets, and improved infrastructure in host communities.