According to data from its most recent consolidated financial accounts, the national oil firm also has varying degrees of ownership in additional oil blocks via NEPL.
The commercial arrangement designated Agip, ExxonMobil, Mobil, Ashbert, NEPL, AshbertiNNPC, NAOC (Nigeria Agip Oil Company), Enageed, Seplat, and Newcross as the operating companies managing the concessions.
Chevron, Oando, Vescar, SO, Nesten, ESSO, TEPNG, Nexen, FHN, Shoreline JV, SPDC, ND Western, and Neconde are among the other partners in the agreement.
while an agent of the JV partners, “the (NNPCL) Group operates OMLs 11 (Aroh field) and 20 (NNPC/Shell JV) and OMLs 49 & 51 (NNPC/Chevron JV) for capacity building, as the Group is not remunerated for its operatorship,” the report stated.
NNPCL as a group is in the business of prospecting, exploration and production of crude oil and gas through various wholly owned assets, joint venture arrangements and production sharing contracts with other companies in the industry.
It stated that all the concessions were within Nigeria, adding that “in the Production Sharing Contracts and Joint Venture arrangements, the partics fund the exploration, development and production costs.
“They are reimbursed in the event of successful exploration by the allocation of crude oil produced from the fields under certain terms and the Group is entitled to between 20 per cent and 60 per cent of the profits accruing from the operations. The Group realises its revenue from the sale of the crude oil allocated to it.”
NNPCL, incorporated in Nigeria on September 21, 2021 as a limited liability company under the Companies and Allied Matters Act, as required by the Petroleum Industry Act of 2021, is established to engage in all commercial activities relating to the petroleum industry.
To give credence to the concession of the blocks, the report stated that the national oil company was charged under Section 64 of the PIA to “carry out petroleum operations on a commercial basis, comparable to private companies in Nigeria carrying out similar activities.
“Concessionaire of all Production Sharing Contracts, Profit Sharing and Risks Service Contracts as the national oil company on behalf of the federation. Lift and sell royalty oil and tax oil on behalf of the Nigerian Upstream Petroleum Regulatory Commission and Federal Inland Revenue Service respectively for an agreed commercial fee.”
It further stated that the company had the mandate to “carry out the management of PSCs for a fee based on the profit oil and profit gas lifted and sold. Carry out test marketing to ascertain the value of crude ofl and report to the commission.
“Assume the working interest of NNPC (corporation) in respect of any Joint Operating Agreement it was party to. Engage in the business of renewables and other energy investments.”
The consolidated statements stated that the firm was also charged to promote the domestic use of natural gas through development and operation of large-scale gas utilisation industries.
It has the mandate to engage in activities that ensure national energy security in an efficient manner in the overall interest of the federation, adding that the firm would “serve as a supplier of last resort for security reasons and all cost shall be for the account of the federation.”
Commenting on the concession of the blocks, an economist and former National President, Association of National Accountants of Nigeria, Dr Sam Nzekwe, stated that the national oil company should use the proceeds from the deals for the interest of Nigerians.
“The law allows them to carry out such concessions on behalf of the Federal Government. But the concern is whether the proceeds from the deals are being used for the benefit of the larger masses, or whether it is cornered by few persons,” he stated.
