OML 130: Nigerian Petroleum Company, NNPC, TotalEnergies Accused Of Violating Local Content Law To Favour American Company, Inflate Rig Cost By $107,000 Daily | Sahara Reporters

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The South-South Reawakening Group (SSRG) has accused the Nigerian National Petroleum Company Limited (NNPC) and its partner, TotalEnergies Upstream Nigeria Limited of allegedly conniving to violate the Nigerian local content law in order to “load” NNPC an extra $107,500 daily cost in hiring an operational rig for the Oil Mining Lease (OML) 130 jointly operated by the two firms.

OML 130 is located in the deep waters of the Niger Delta area adjacent to the Nigeria Sao-Tome Joint Development Zone. The block contains the onstream Akpo gas-condensate field, and Egina, which is under development by TotalEnergies.

PALMERON, according to findings, came up with a plan to own the first Nigeria Drillship via a bareboat charter agreement with an obligation to purchase the rig with an arrangement for the rig to carry the Nigerian flag and also along the way build local capacity and possibly venture into the international market.

South-South Reawakening Group, SSRG in a statement condemning what it claimed was an attempt by a high-level official of the NNPC to undermine the process, said, “Shockingly, in August 2022, TotalEnergies sent a request to award the contract to a consortium comprising TIREX, a company which did not participate in the tender process. This action prompted PALMERON to make a formal complaint to the GCEO of NNPC.

“The Letter of Intent issued to TIREX consortium is a questionable behaviour, which was not committed in error but rather intentional as it involves a lot of secretive and non-authorised actions of which PALMERON is a victim. .” “If an award was made to PALMERON in April, PALMERON proposed Drillship would have been in Nigeria by August drilling to support Nigeria economy. The result of the signed commercial evaluation in 2021 triggered several engagements and negotiations with PALMERON being the winner in the tender. There were series of requests specifically planned to frustrate PALMERON, but they were able to maneuver and survive.

“To further put PALMERON at a disadvantage, TotalEnergies under the instruction and supervision of NAPIMS management, falsified PALMERON’s rig availability date with a delayed duration of 3 months, a cost implication was imposed to ensure a higher rate for PALMERON, by introducing production deferment assumptions which were not part of the approved commercial evaluation and not an acceptable or proven industry practice.

 

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