It was one of the few times that the potential for a clash between the separate bidding rounds has been specifically addressed by the government and the Nigerian press, and its resolution sounds like a good one for ERHC and other Gulf of Guinea investors.
This Day, one of the nation's most sophisticated news Websites, reported:
FG to Offer 63 Oil Blocks
From Onyebuchi Ezigbo in Abuja, 01.13.2005
Federal Government has penciled down a total of 63 new oil blocks for offer during the next licensing rounds to be held in the first quarter of 2005.
A competent source at the Department of Petroleum Resources (DPR), which gave the figure to This Day yesterday, said the oil blocks are located in the onshore, offshore and deep-offshore areas.
While confirming the figure, an official of the Ministry of Petroleum Resource said that although the Federal Government is very anxious to get the process started, it would not want to let it clash with the schedule to announce winners of the Nigeria-Sao Tome and Principe Joint Development Zone Licensing rounds which was shifted from December last year to January 2005 due to the Christmas holidays.
He said government has therefore directed that "winners of the 2005 licensing rounds be announced [at the] latest [in] June," adding that those concerned with the arrangements for licensing rounds are to ensure that the bids for the oil blocks [are received] before the end of the first quarter of the year.
The Special Adviser to the President on Petroleum and Energy, Dr. Edmund Daukoru, had said during 2004 Licensing Rounds for the oil blocks belonging to the Nigeria-Sao Tome and Principe Joint Development Zone that government intends to put forward a number of new oil blocks at the next licensing rounds to be held early this year.
Daukoru expressed the view that the next licensing rounds will witness a higher number of investors, judging from the immense competition that followed response to the five JDA oil blocks [offered] last November 15. Government has projected an increase in the crude oil reserve potential of the country to hit about 40 billion barrels by 2010.
The adviser said government hopes to rely on the development of new oil blocks, especially in the ultra-deep offshore to achieve the dream.
Nigeria currently produces about 26 million barrels of crude a year, accounting for more than $22 billion of its $24-billion Gross Domestic Product, and has some 35 billion barrels of crude oil reserves, according to data from OPEC.
The fact that the story draws heavily on comments by Dr. Edmund Daukoro establishes clearly the intent of the government to keep the JDZ awards on track even at some expense to its own fields.
It was Daukoru who apparently miscalculated the impact of the Christmas and New year's holidays on the selection process. After the propsective bids were announced on Dec. 15, Daukoru had told the media on Nov. 15, awards would be announced on Dec. 31.
The delay of that awards announcement has caused untold frustration and chagrin for investors around the world who awaited the outcome. Now, it appears, the government is trying earnestly to make amends by clarifying the new awards deadline, although not with the specificity of his Nov. 15 speech.
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