Flawed oil bidding process unpacked

Shortly before the 2003 presidential election, Funsho Kupolokun, the Special Assistant to then President Olusegun Obasanjo hurriedly put together a bid round for three oil blocks. At the end of the process during which only Elf Petroleum, ExxonMobil Ltd, Vintage Oil and Gas, and ECL International Ltd participated, ExxonMobil and Vintage Oil and Gas were jointly awarded OPL 257 while ECL International Ltd got OPL 251. OPL 223 was not awarded to any company. The Premium Times reports that a House of Representatives committee which investigated those allocations five years later described the bid as ‘curious’ because it was done three years after the introduction of the principle of open, competitive bidding. Also, none of the blocks was listed as being on offer in a report of the Committee on the Evaluation of Bids for the Year 2000 Licensing Rounds. Part of the reasons for the flouting of due process in the allocation was poor oversight of the process from Obasanjo who was Petroleum Minister at the time. ‘The circumstances in which Elf Petroleum Limited that had not been awarded OPL 223 on March 12, 2003, came to be awarded the same block six weeks later on April 29, 2003, is suspicious,’ the committee report stated. The committee recommended that since the award of OPL 223 could not be revoked due to the involvement of the NPDC, the balance of $5m be immediately recovered from Elf Petroleum Nigeria Limited.

Full Premium Times report