By Emeka Nze
In a few months from now, Aiteo Eastern Exploration and Production (E&P) Company Limited Group, subsidiary of Aiteo Group would know whether its Oil Mining Licence (OML) 29 it acquired from Shell Petroleum Development Company of Nigeria Limited (SPDC) at a cost of $1.7 billion would be renewed by the Federal Government.
Prior to the acquisition, OML 29 which is currently producing about 90,000 bopd was renewed by the Federal Government of Nigeria for Shell Petroleum Development Company (SPDC) in July 1989 for 30 years, bringing its validity to an end in June 2019.
The concerns on the renewal are anchored on two planks, namely: Aiteo owner, Benedict Peters was in the good books of the Goodluck Jonathan administration, a development that is known to the current regime, casting skepticism on the oil man as to whether he can be trusted by the current regime. The company’s foray into football through sponsorship of the Nigerian Football Federation (NFF) League is one of the strategies to find favour aimed at playing into the hearts of the current administration.
The second area of worry on the oil bloc renewal borders on the company’s creditors. Given, the financial history and antecedent of Benedict Peters as a successful key player in the downstream, the banks trusted him, making the banks to rally round Aiteo to structure a world class syndicated loan facility for the oil company. With the oil licence at the verge of expiry, the banks are apprehensive as to whether it will be renewed.
OML 29 which contains 11 oil and gas fields, is located in the southeastern Niger Delta. It also includes the Nembe Oil Field, Santa Barbara Oil Field and Okoroba Oil Fields, and the Nembe Creek Trunk Line NCTL.