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Operators differ over legality of 3 oil and gas free zones

By Godfrey Bivbere

Operators have continued to criticize the legality and operations of the three oil and gas free zones operated by oil logistics giant, INTELS.

Some operators are of the opinion that the operations of the three oil and gas free zones, namely, Oil and Gas Free Zones in Warri Port Complex, Delta State; Eko Support Services (ESS) Lagos and Brass Oil and Gas City, Brass Island, Bayelsa State, are illegal since they are not licensed by Nigerian Exports Processing Zones Authority, NEPZA.

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Others, however argued that the legality and operations of the three oil and gas free zones operated by Intels are legal as they were established by the Oil and Gas Free Zone Authority, OGFZA, which is empowered by the Federal Government to do so.

Speaking with Vanguard on the issue, a Lagos based lawyer, Ehis Agboga, said it is wrong because in law a delegate has no power to delegate.

According to him “a delegate cannot itself delegate, that is the legal principle.” He, however, stressed that though he has not seen the law establishing the OGFZA, however, it is wrong to license the three zones unless the OGFZA is empowered to do so.

When contacted, the Managing Director of Nigerian Export Promotion Zone Authority, NEPZA, Gbenga Kuye said “They were not licensed by NEPZA.” . When asked if any other body has the power to license the operations of the three free zones, the NEPZA boss refused to comment.

Analysing the situation, a source close to NEPZA who preferred anonymity said: “In the Oil and Gas Export Free Zone Act, Section 1 (1) titled Designation and Establishment of the Oil and Gas Export Free Zone, it was stated clearly that ‘The President hereby designates the Onne/Ikpokiri area of Rivers State as an Export Free Zone (in this Act referred to as the Free Zone’).

“By this Act, there is only one legally established oil and gas free zone, and that is the one in Onne, and this makes any other purported free zone null and void because there is no law to back it up”, the source added.
Meanwhuile, the website of OGFZA listed the functions of the Authority to include: license, regulate, supervise, manage, control and co-ordinate the activities of OGFZs in the country, grant requisite permit and license to all prospective investors wishing to do business within OGFZs in Nigeria, fixing tariffs and tax-free benefits.
Others functions according to the Authority’s websitwe are: incentive packages, free zone administration, free zone promotion, ensure that maximum free zone incentives and benefits are passed to the free zone registered companies.
However, a maritime expert and Managing Director of Tentpeg Communication Network Ltd., Goddy Oghenejakpor, noted that the Federal Government is to blame for the controversy because of the creation of different bodies with overlapping functions as is the case with both OGFZA and NEPZA.
Oghenejakpor explained that it is the responsibility of the legislative arm of government to give details on what the functions of each of the Authorities are.

He noted that even if the OGFZA has the powers to license other bodies, he wondered why it has only licensed three which belongs to one company.
This, he said would further create the monopoly which operators have been complaining about.


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Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.