The story seems to reflect a point of view that is exclusively informed by the Nigerian side. However, in a note from Africa yesterday, a well-informed source told ERHC On The Move that the fault for the blow-up lay not with Sao Tome but Nigeria, which failed to follow "due process" rules that deprived the delegation of opportunities for document review the JMC should have provided.
Moreover, the sources say, the Nigerian side knew very well that their failure to observe the due process was likely to lead to problems.
That is one reason no apology is forthcoming from the Sao Tome side, the source said.
One revelation in the stories is that the Addax chairman Jean Gandur is good on his feet, and his comments indicate that he will be available to the press in ways that Sir Emeka Offor is not. I think many investors will find that a major plus, as ERHC Energy's greatest weakness has always been its information handling. Some would say, though, that the information the company provides has been responsible for two remarkable recoveries in recent weeks.
Here are the two latest stories from ThisDay Online's well-seasoned oil writers, Mike Oduniyi and Onyebuchi Ezigbo. The first is about the new date for the next JMC meeting, and the second about Friday's events:
Nigeria, Sao Tome Pick New Date for Deal on JDZ Block
By Mike Oduniyi, 02.27.2006
Nigeria and Republic of Sao Tome and Principe have picked a new date for the signing of the Production Sharing Contract (PSC) on an offshore block in the Joint Development Zone (JDZ) of the Gulf of Guinea.
The two countries failed last weekend to ink the deal for block 4, owned by the consortium of Swiss firm, Addax Petroleum and US-based oil firm ERHC Energy.
Managing Director of ERHC Energy, in which Nigerian indigenous oil firm Chrome Energy has a major stake, Mr Walter Brandhuber, told THISDAY yesterday that the Joint Development Authority (JDA) has fixed a new date of March 14, 2006 for the signing of the PSC.
“The JDA has informed us that the signing of the PSC will now take place on March 14,” he said.
The PSC signing, which has dragged on for more than five months, was botched on Friday after Sao Tome officials requested postponement of the meeting slated for Abuja.
JDA also said in a statement that postponement was due to “unforeseen administrative issues.
“These issues are not fundamental to the subsisting agreement, and spirited efforts are being made to resolve those issues preparatory to the signing of the PSC,” it said.
The other companies having stakes in the bloc include, Conoil with (20%), Godsonic Oil Ltd (5%), Hercules (10%) and Overt (5%).
Officials of Sao Tome and Principe who were at the botched meeting had sought for more time to enable it thoroughly examine the letters of the agreement, adding that it still shares common interest with Nigeria as fair speeding up the development of resources within the zone.
Under the treaty governing the JDZ, revenue to be derived from the operation of oil blocs are to be shared on the basis of 60/40 for Nigeria and Sao Tome and Principe respectively.
The Chairman of Addax, Mr. Jean Claude had also expressed the hope that Nigeria and Sao Tome and Principe would be able to resolve the matter in good time so as to maximize the great opportunities inherent in the JDZ agreement.
This is the story on the blow-up:
JDZ: Nigeria Condemns Botched PSC Signing
From Onyebuchi Ezigbo in Abuja, 02.27.2006
Nigeria at the weekend demanded a public apology from the government of Sao Tome and Principe over its last minute pull- out from a scheduled signing of the production sharing contract (PSC) on an offshore oil block in the Joint Development Zone (JDZ) managed by the two countries.
The PSC signing for block 4 was to have been with Swiss firm Addax and another consortium which clinched the acreage in the second batch of the 2005 oil licensing round put out under the JDZ collaborative initiative.
All the parties had gathered at the headquarters of JDA in Abuja by 8 PM, Friday night after the event was shifted from the earlier time of 11.30 am, to witness the signing ceremony but rather than have the signing of the agreement proceed as expected, officials from Sao Tome surprisingly asked for the postponement of the ceremony, to enable them to have another look at the draft PSC agreement and the Joint Operating Agreement (JOA).
Nigeria's Minister of State for Petroleum, Dr. Edmund Daukoru, who broke the unpleasant news of the cancellation of the signing ceremony to all the parties, expressed displeasure at the turn of events, especially the continued dragging of feet on the oil deal by Sao Tome.
An American oil firm, Environmental Remediation Holding Company (ERHC), whose majority shareholder happens to be a Nigerian, Chief Emeka Offor, won the operatorship of bloc 4 and has recently entered into joint operating partnership with Addax oil company.
The other companies having stakes in the bloc include Conoil with (20%), Godsonic Oil Ltd (5%), Hercules (10%) and Overt (5%).
While absolving Nigeria of any responsibility for the disappointing show, Daukoru said the country would require a public apology from Sao Tome government over the incident.
He said the FG considered the incident a major embarrassment for which the government of Sao Tome and Principe would have to issue an apology.
An obviously displeased Minister regretted the inability to consummate the bloc 4 agreement as scheduled, saying that the action is not sending the right signal to investors.
"It is very a terrible thing, it is not good. This does not send the right signal to investors. It cannot event quantify the loss in terms of the bad image it has created", he said.
"I feel very sad today, I am an oil man, not a diplomat. Oil business is not run in this manner. I really feel the authorities of SaoTome have to issue a apology on this", he said.
He said there was no real justification for the request for the postponement, adding that before now, Sao Tome and Principe has asked for more time to enable them careful study of the draft contract agreement which "we bended over to allow".
The Minister said that prior to the scheduling of the event, copies of both the PSC and JOA agreement were circulated to all parties with request and enough time for comments and differences to be resolved.
The minister said he does not think fundamental change will be made in the PSC which is modeled out of the one signed by bloc one operator, Chevron.
Daukoru recalled the protracted nature of the process of negotiations leading to the award of the oil blocs at the end of the 2005 licensing round which he attributed to the "peculiar nature of relationship between Nigeria and Sao Tome and Principe".
Expressing concern on the market loss this continued delay is bound to bring about, Daukoru said with regard to the bloc one operated by Chevron, the operators has reportedly hit a first oil in the field which meant that they would benefit from the current high oil prices.
"This cost of crude oil in the international market is going higher and higher. The business in the industry is counted in time. This is not how to do oil business. Nigeria is not happy about the delay but we would take it as part of the sacrifices to be made in ensuring the survival of the partnership.
Under the treaty governing the JDZ, revenue to be derived from the operation of oil blocs are to be shared on the basis of 60/40 for Nigeria and Sao Tome and Principe respectively.
The Chairman of ADDAX, Mr. Jean Claude who spoke later to newsmen on the issue, expressed the hope that Nigeria and Sao Tome and Principe would be able to resolve the matter in good time so as to maximize the great opportunities inherent in the JDZ agreement.
Officials of Sao Tome and Principe who were at the event said their had to seek for more time to enable it thoroughly examine the letters of the agreement, adding that it still shares common interest with Nigeria as fair speeding up the development of resources within the zone.
No comments:
Post a Comment