Oil multinationals

By Obas Esiedesa – Abuja

The Federal Government has said henceforth only companies with capacity to operate divested assets in the oil and gas industry would be allowed to buy them.

The Minister of State Petroleum Resources, Chief Timipre Sylva who disclosed this at separate business meetings with top management of  Chevron and Schlumberger at their headquarters, in Houston, Texas, United States, said the government will carefully scrutinise oil companies who will bid for the takeover of assets that Shell and other oil majors will be divesting from in the country.

It would be recalled that Shell and ExxonMobil have indicated their interests to divest from onshore and shallow water assets in the country.

Chief Sylva said the Federal Government will carry out due diligence in the selection and eventual approval of any company that will take over the assets from which these companies intend to divest.

He stated that the previous practice whereby companies are just allowed to purchase strategic without verifying their capacity to operate such assets would no longer be tolerated. 

According to him, “In the past companies were just allowed to buy assets that they had no capacity to operate.

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“We would no longer allow that to happen again because Government is the ultimate lover. If they are not able to operate such assets optimally government won’t be able to generate revenue from such assets.

“So we are going to do our best to ensure that will get the best value from these assets”.

He told Chevron and Schlumberger team teams that government would create the enabling environment for them to increase their investments in Nigeria adding that with the passage of the Petroleum Industry Act (PIA) Nigeria would increase the incentives for investments in the oilnand gas sector of the economy.

“With PIA we now have the enabling laws that protect and make the operating environment more attractive.

“With the passage of the PIA there are a lot of interests in the oil and gas sector in Nigeria today. The responses we have gotten from investors so far is quite good.

“Everybody is quite happy,” Sylva said adding that the Nigerian government while willing to encourage new investors would open its doors first to those who already have business and investments in the country.

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