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How Oil Output from Addax-operated OMLs Fell from 130,000bpd to 7,000bpd Amid OPEC Deficit



Production from assets operated by Addax Petroleum slumped massively from 130,000 barrels per day to 7,000bpd amid disagreements with the federal government, a new document released by the Nigerian National Petroleum Company Limited (NNPC) has revealed.

The NNPC’s latest quarterly publication of its activities indicated that the Production Sharing Contract (PSC) on Oil Mining Leases (OMLs) 123/124 and 126/137 crumbled after the Chinese-owned Addax declined to make new investments on the assets, leading to a fall of budgetary allocation from over $2 billion to barely $200,000 when the firm was exiting the assets last year.

The NNPC had on January 31, 2023 announced the termination of the 24-year deal with Addax Petroleum Development (Nigeria) Limited, marking the exit of the Sinopec of China’s subsidiary.

The official end to the business relationship came three months after the execution of the Addax Transfer, Settlement, and Exit Agreement (TSEA) for the PSC Oil blocks, OMLs 123/124 & 126/137, with the assets then transferred to the concessionaire, NNPC.

The PSC for the oil blocks was initially signed in 1973 between the NNPC and America’s Ashland, but was terminated after 25 years. Subsequently, the NNPC signed another PSC with the Swiss and then with China’s Sinopec, which retained the name Addax in 1998.

However, the Addax PSCs were associated with significant intricacies and complexities and attendant disputes, even threatening the diplomatic relations between Nigeria and China at a point.

Multiple litigations then ensued, hindering the attainment of the desired objectives of value creation to the PSC parties, government, and other stakeholders.

Now renamed Antan Producing, a Special Purpose Vehicle (SPV), the NNPC in the publication stated that after initially raising production from 7,000 bpd to 15,000bpd, the target this year is to further increase production to 30,000 bpd.

The new Managing Director of the oil asset, Sagiru Jajere, interviewed by the NNPC in-house staff, said that with the support from the parent body, the NNPC, he had begun to gradually sort out the problems with the assets.

“On the day the assets transfer agreement was signed when we took over, production was just above 7,000 bpd. But as of today, we are doing well over 12,000 barrels from OML 123 alone. We are doing another 3,000 barrels from OML 126. That is 15,000 bpd, up from 7,000 bpd, ”he said.

However, Jajere stated that more investment was required on the asset to ensure increased production.

“The only way to increase production in a sustainable manner is to get more investment. That is necessary for this business. We knew why we came down to the weak production status.

“But you can remember that at a time, we were producing well above our OPEC quota. In fact, there were times we were penalised for producing above our quota. Gradually, we saw the figures dropping, ”he added.

He argued that there are fiscal terms, which have made some investors to stay away from investing in the sector.

“Unless we do something to attract investments, all these activities we’re doing to bring up production to meet the OPEC quota will not amount to much. So, we are trying to make the business attractive so that people can come back and invest, ”he stressed.

Jajere disclosed that the NNPC had had to re-enter some wells that were shut for no real reasons, explaining that it was discovered that some wells were shut at the slightest challenge by the former operators.

“We believe that will give us a volume that will most likely take us to somewhere around 25,000 to 30,000 bpd. In the long-term, we are also looking at OML 137, which is also a big reservoir of oil with a lot of gas.

“This is a huge opportunity that we are looking at. By the time we get there, the production from Antan will be somewhere above 50,000bpd, plus the gas we want to develop and commercialise, ”he stated.

According to him, the issues with Addax were withdrawal of financial incentive package and lack of investments in the asset.

“Everything was going down. We saw it from outside. But you have to be in before you can see some things. The day I stepped into the office at Addax, that was when I realized how terribly bad things had gone, ”Jajere stressed.

If Adax was producing up to capacity, a THISDAY calculation showed that it would be adding up to 4 million barrels every month to Nigeria’s Organisation of Petroleum Exporting Countries (OPEC) quota, which at the end of 2023 was still short by over 500,000 bpd.

Head of Business Services, Victoria Iroro, said the problem with Addax was that the fiscal terms that were agreed at the time they acquired the company were not being implemented.

“Therefore, Sinopec-Addax stopped investing in the development of the assets. The government didn’t like that because it was supposed to be continuous investment.

“This was why the government, through NNPC, decided to take over the assets and operate them. That was how Antan Producing Ltd was incorporated as a special purpose vehicle to operate the assets, ”she added.

According to her, Sinopec did well until they started having issues defaulting by not investing, thereby affecting the morale of staff.

“Production went down, sagging from 130,000bpd to 20,000bpd and further down to 7,000bpd. That was how the government stepped in and decided to take it over as Antan Producing Limited, ”she said.

She argued that the takeover of Addax by the NNPC and the renaming to Anton was a good decision, which was helping to restore some confidence in the workers.

“Sometime ago in 2013, I worked in the finance department at the time and I was responsible for budget and planning. We were running a budget of $2billion and above for the operations of the company.

“But right before our eyes, we started seeing everything sliding until it got to $200,000. You can imagine how bad things went, ”she added.

On his part, the Head of Operations of the SPV, Jeremy Nnajiofor, said a security arrangement to ensure the pipelines are protected had been put in place so that production can be moved to the Agip facility nearby in order to avoid further shut down of the wells.

“And there were a lot of legacy and integrity issues. This was like a challenge because the government took over the assets to prove that a Nigerian company can run this business and grow it. So, we reviewed the situation and came up with a couple of things we needed to do at immediately. We identified the low hanging opportunities that we can explore to grow production, ”he added.

According to him the desire is to get back to above 100,000, which the assets had done in the past.

“I think it is a realisable in the mid to long term. But we need a lot of investment to achieve that, ”he stated.

News and Report

N3bn Fraud Trial: Court permits Yahaya Bello’s accused nephew to travel abroad





The Federal High Court in Abuja has permitted an accused nephew of former Kogi State Governor Yahaya Bello to travel to the United Kingdom for medical attention.


To enable the defendant, Ali Bello, to embark on the foreign medical trip, the court ordered the release of his passport seized from him as part of his bail conditions.


Obiora Egwuatu, the trial judge, issued the order on Monday, overruling the objection of the prosecution agency, the Economic and Financial Crimes Commission (EFCC), to grant the accused person’s request.


He said the prosecution failed to present convincing evidence to back its claim that Ali would jump bail or tamper with evidence if allowed to embark on the medical trip.


He said he had no reason to believe Ali would jump bail, having fulfilled previous undertakings to return to Nigeria to continue his trial on two separate occasions.


“Since the grant of bail, he has not breached the terms of bail and has been coming to court to stand his trial.


“It is not controverted that this court had on two previous occasions granted the applicant similar prayers.


“On those two occasions, that is, between the 1 to 31 August 2023 and 17 December 2023 and 10 January 2024, the applicant did not breach the terms of the permission granted,” the judge said.


Stressing the need to ensure a defendant is healthy to stand trial, the judge said, “I wholeheartedly subscribe to the view that a defendant should be alive to stand trial” and face the consequences of his crime if found guilty.


Mr Egwuatu ordered the court’s deputy chief registrar who keeps Ali’s passport to release it to him, the News Agency of Nigeria (NAN) reports.


He also ordered the defendant to return the passport on or before 15 September.


Series of charges relating to Kogi funds

Ali and three others are standing trial on money laundering charges involving N3 billion allegedly diverted from the Kogi State coffers during former Governor Bello’s tenure.


The three co-defendants in the case are Abba Adaudu, Yakubu Siyaka Adabenege and Iyadi Sadat.


The case is only one in a series of prosecutions the EFCC brought against Ali, Mr Bello and their associates over their alleged fraudulent handling of Kogi State Government’s funds.


Ali and a co-defendant, Dauda Sulaiman, are charged with money laundering in another case involving the alleged diversion of N10 billion of Kogi State’s funds. The case is before a different judge of the Federal High Court in Abuja, James Omotosho. The prosecution has already called seven witnesses in the trial.


Mr Bello, the former governor, faces money laundering charges involving an alleged diversion of Kogi State’s N80 billion in a separate case before Mr Omotosho. Both Ali and Mr Suleiman are named as accomplices in the case.


EFCC brought the charges against Mr Bello after completing his two terms of eight years as governor in January but has been unable to get him to court for arraignment.


Since April, Mr Bello has shunned six court sessions scheduled for his arraignment, which has now been rescheduled for 25 September.


Ali’s medical trip request

On 5 April, Ali filed an application in the trial before Mr Egwatu seeking an order to release his passport from the deputy chief registrar of the court to enable him to travel abroad for medical consultation and examination.


He said the trip was to fulfil a routine cardiologic follow-up to review his medication and undergo cardiac tests.


He said he received medical advice to undergo the process annually.


He also recalled that the judge had granted him similar permissions to embark on the foreign medical trip on two occasions – first between 1 and 31 August 2023 and second between 17 December 2023 and 10 January 2024.


He said he returned to Nigeria on both occasions and returned his passport to the court’s deputy chief registrar as he was ordered to.


He pleaded with the judge to order the release of his passport again, undertaking to return it to the official upon his return from the UK to Nigeria.


The defendant also gave an assurance to be law abiding in the UK.


EFCC opposes request

The EFCC opposed the application.


Arguing against the request in court, EFCC’s prosecuting counsel, Rotimi Oyedepo, a SAN, cited a five-paragraph counter-affidavit detailing reasons for the commission’s objection. An EFCC official, Abubakar Salihu Wara, swore to the facts in the document on 19 April.


Mr Oyedepo argued that Ali failed to place any medical report before the court to show the health condition that necessitated the medical appointment.


Mr Oyedepo said Exhibit ‘A’ attached to the application did not disclose the email address of the sender and the receiver of the said medical appointment.


He added that the applicant did not present anything to show that Exhibit ‘A’ emanated from the London Centre for Advanced Cardiology as claimed.


He argued that Ali might tamper with evidence gathered for his prosecution if his application is granted.


However, Ali filed a further affidavit to dispute the prosecution’s claims.



Apart from banking on the reputation Ali had earned by fulfilling his promises to return to Nigeria when granted the foreign trip permissions on two previous occasions, the judge also ruled that EFCC’s reasons for objecting to the request were not convincing.


Mr Egwatu held that EFCC failed to show that the name of the London hospital Ali planned to visit and its address “are not in existence”. He said there was no contrary evidence disputing the fact that the applicant “has a scheduled appointment with the said cardiologist.”


According to him, there was also no evidence presented by the EFCC to show that while Ali was on bail, he did or attempted to interfere with evidence or collude with any person to tamper with evidence.


The judge further said that a defendant ought to be healthy to stand the rigours of trial.


Former Central Bank of Nigeria (CBN) governor Godwin Emefiele, facing multiple corruption trials, recently applied to the High Court of the Federal Capital Territory, Abuja, to seek medical attention in the UK, but the court rejected the request.


The judge in the case upheld EFCC’s objection, which was argued by Mr Oyedepo, the same prosecutor in Ali’s trial.





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News and Report

Reps ask FG to suspend NMDPRA boss over anti-Dangote refinery comment





The House of Representatives has called on the Federal Government to suspend the Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, pending the conclusion of the investigations of allegations against what it called the unguarded statement by the CEO.


The resolution of the House followed the adoption of a motion of urgent public importance sponsored by the member representing Esosa Federal Constituency, Edo State, Esosa Iyawe, during Tuesday’s plenary on the need to address issues arising from Farouk’s utterances about the nation’s local refineries.


The lawmaker reminded his colleagues that claims of adulterated fuel in the Nigerian market must be thoroughly investigated, stating that fuel quality can impact engine hardware.


This he said, is the reason ultra-low sulphur diesel is recommended for all types of power plants, storage tanks, industrial facilities, fleets and heavy equipment, and even ships, as high sulphur content in fuels, causes damage to engines and contributes to air pollution.


He said considering the various risks associated with sulphur, countries across the world have taken steps to regulate it by setting standards that require maximum reduction of emissions of this chemical compound, which diesel producers are expected to adhere to.


The Labour Party lawmaker, however, noted that the NMDPRA permits local refiners to produce diesel with Sulphur content of up to 650 parts per million until January 2025, as approved by the Economic Community of West African States.


He quoted the NMDPRA boss as saying that the diesel produced by the Dangote Refinery is inferior to the ones imported into the country and that their fuel had a large content of sulphur, which he put at between 650 to 1,200 ppm.



“In their defence, Dangote called for a test of their products, which was supervised by members of the House of Representatives, wherein it was revealed that Dangote’s diesel had a Sulphur content of 87.6 ppm (parts per million), whereas the other two samples diesel imported showed sulphur levels exceeding 1800 ppm and 2000 ppm respectively, thus disproving the allegations made by the NMDPRA boss.



“Allegations have been made that the NMDPRA was giving licences to some traders who regularly import high-sulphur content diesel into Nigeria, and the use of such products poses grave health risks and huge financial losses for Nigerians.


“The unguarded statements by the Chief Executive of the NMDPRA, which has since been disproved, sparked an outrage from Nigerians who tagged his undermining of local refineries and insistence on the continued importation of fuel an act of economic sabotage, as the imported products have been shown to contain high levels of dangerous compounds.”


He condemned what he called the careless statement by Farouk, noting that “Without conducting any prior investigation, he was not only unprofessional but also unpatriotic, especially in the face of the recent calls for protest against the Federal Government.”


Recall that a joint committee of the House on Monday, July 22, 2024, commenced investigations into Farouk’s allegations against Dangote Refinery.


The panel, made up of the Committees on Petroleum (Downstream and Midstream) is also conducting a legislative forensic investigation into “The presence of middlemen in crude trading and alleged unavailability of international standard laboratories to check adulterate

d products”, among others.




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News and Report

Democrats Raise Over $40 Million Online Following Biden’s Presidential Race Exit




In a remarkable display of financial support, Democrats raised more than $40 million online following President Joe Biden’s announcement that he would be exiting the presidential race. This surge in donations, which occurred on Sunday, marked the most significant single day of online contributions for the Democratic Party since the 2020 election.

According to a New York Times analysis of ActBlue’s online contribution tracker, the wave of donations began shortly after President Biden’s withdrawal and coincided with Vice President Kamala Harris gaining momentum in the nomination race. Prior to Biden’s announcement, donations were averaging less than $200,000 per hour. However, within just one hour after the news broke, donations soared to $7.5 million.

The ActBlue platform processes contributions for various Democratic candidates and causes, not limited to Biden or Harris. It includes donations to Democratic House and Senate candidates as well as political nonprofits. The overall increase in donations highlights the unified support within the party during a pivotal moment.

Kenneth Pennington, a Democratic digital strategist, expressed his enthusiasm on X (formerly Twitter), stating, “This might be the greatest fundraising moment in Democratic Party history.” The previous record for single-day donations on ActBlue was set after the death of Justice Ruth Bader Ginsburg in September 2020, with approximately $73.5 million processed. Sunday’s donations, reaching over $50 million by the end of the day, made it one of the platform’s most successful days ever.

The influx of contributions comes at a critical time for the Democratic Party, which has been grappling with internal conflicts and a need to regain momentum in the race aga inst former President Donald J. Trump. Fundraising had significantly slowed among major Democratic donors following President Biden’s underwhelming debate performance, but his departure from the race seemed to galvanize the party’s base.

Biden’s exit and his endorsement of Vice President Harris appeared to unify Democratic supporters, resulting in a dramatic spike in contributions. As Harris builds momentum to secure the nomination, the financial backing will undoubtedly play a crucial role in her campaign.

President Biden’s withdrawal had been anticipated by many, although the timing came as a surprise. He announced his decision while recovering from Covid at his Delaware beach house. In a letter posted on X, Biden reflected on his presidency, calling it the “greatest honor of my life.” He emphasized that stepping down was in the best interest of the party and the country, allowing him to focus on his duties for the remainder of his term.

Biden’s endorsement of Harris was swift and unequivocal, with his campaign quickly rebranding to “Harris for President.” Prominent Democrats and potential rivals, including California Governor Gavin Newsom, promptly voiced their support for Harris.

The surge in donations following Biden’s exit signifies a critical juncture for the Democratic Party. With substantial financial resources now at their disposal, the party aims to leverage this momentum to overcome recent challenges and strengthen their position in the upcoming election.


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