Alison-Madueke considers pouring oil on troubled waters
Nigeria is considering watering down proposed changes to the fiscal regime for international oil companies operating offshore after warnings that they will drive away investment and cost hundreds of thousands of jobs.
The terms are part of a delayed petroleum industry bill, intended to transform the oil sector in Africa’s largest crude producer after decades of mismanagement and corruption Signs of willingness by the government to review a planned rise in royalties comes at a critical moment, since the legislation is awaiting final approval from lawmakers and should be passed within “two to three months”, according to petroleum minister Diezani Alison-Madueke.
The legislation has still to overcome domestic political opposition as well as lobbying from the oil industry and similar timelines have not been met in the past.
In an interview with the FT, Allison-Madueke said the new fiscal terms were “equitable”, and would only increase the government’s total take by 7-8 per cent. But she added that there was “room for compromise” on a planned rise in royalties for production sharing contracts offshore, and that talks with multinational companies such as Shell, Chevron, ExxonMobil, Total and Eni were ongoing.
“They still feel we are too far apart,” said Allison-Madueke, who is Nigeria’s first woman oil minister and is one of President Goodluck Jonathan’s closest allies. “We would like to feel that at the end of the day we have some fairly median point.”
Uncertainly over the bill has caused stagnation in the oil industry, with little spending on exploration in recent years. Production is stuck at about 2.4m barrels a day, barely half what was targeted a decade ago.
If passed, the legislation will see the state-owned Nigerian National Petroleum Corporation stripped of regulatory powers and split into three companies, including a listed oil company run along commercial lines. The downstream oil sector, which has seen billions of dollars stolen through collusion between fuel marketers and corrupt officials will be deregulated and liberalised.
International oil companies have profited in the past from opaque rules and lax controls, and in many cases have failed to adhere to international standards on environment protection.
But rising insecurity and oil theft in the Niger delta have led the multinationals to focus more on deepwater projects, which unlike onshore joint venture operations are governed by production sharing contracts with better terms.
Allison-Madueke said the proposed changes were still less onerous than in countries such as Angola and Indonesia.
But in a presentation to diplomats, civil society groups and government officials in the capital Abuja last week, oil company officials warned that if the bill was not amended, 470,000 jobs and up to $100billion in investment could be lost by 2020. There would be no investment in new deep- water projects.
Allison-Madueke disagreed with the prognosis, but she said it was difficult to say that the oil companies “are being totally alarmist”.
She said that she expected the existing western players in Nigeria to be the government’s partners for years to come but that if they prove reluctant to invest under the new legislation it could open the door for Chinese and other emerging power oil companies to “roll on in”.
“We have a lot more competition in the sub-Saharan region than we had before, when we were pretty much the sole explorer and producing nation. For that fact alone, and also to keep the discourse going, we are still in discussion [with the oil companies].”
A former Shell employee, Allison-Madueke is a controversial figure in Nigeria. She is accused by opponents of running the oil ministry like a personal fiefdom. But she is fierce in her own defence.
“If you are determined to move reforms, you will be seen as a controversial figure, whether you like it or not,” she said, adding that her decision to suspend dozens of fuel marketing companies last November because of suspicions of fraud had led to “vilification, abuse and threats to my life”.
Arsenal chase sensational Nigerian youngster nicknamed ‘New Messi’
By Nelson Dafe, News Express, on 18/11/2012
English Barclay’s Premier League giants Arsenal are reportedly hot on the heels of fast-rising Nigerian wonder kid, Emmanuel Bakare. The petite wing wizard, 14, was one of the star players that graced the recently concluded Copa Africa football tournament in South Africa. The tournament is an annual competition organised by soft drinks giants Coca Cola for youth teams from all over Africa who represent their countries.
Speaking with News Express on his return from South Africa, Bakare informs that his representatives have been contacted by the Arsenal officials and that negotiations are ongoing. His words: “Arsenal scouts who were in South Africa expressed satisfaction with the way I played. I had encouraging words from them and I hope and trust that I can have a good deal because I have love for the Gunners.”
The wing dazzler was picked as Copa Nigeria’s best player this year after posting very impressive performances in the Coca Cola Cup held earlier in the year across the country. His strength in the game lies in fanciful trickery with his feet, laced with good pace and a low centre of gravity that makes him difficult to be dispossessed when he has the ball. Many who have taken a liking to his game have christened him the ‘New Messi’.
News Express monitored the Copa Cup competition in South Africa where scouts from different top European teams were on hand to identify exciting young talents, while trying to reach deals with their agents with a view to signing them.
Arsenal had a conspicuous presence with top scout Mark Ellis keenly watching the games. The London giants have a long and admirable tradition of unearthing unknown prospects. Arsenal manager, Arsene Wenger, is reputed for his eye for talented greenhorns, and turning them into world stars. Many years ago he signed an unknown Liberian from a Cameroonian club side. George Opong Weah went on to become the world’s best player in 2005.
•Photo shows Arsenal’s scout Mark Ellis with Emmanuel Bakare (right) in South Africa.