EXCLUSIVE: President Buhari Stops Nigerian Oil Companies From Lifting Crude Oil
BEVERLY HILLS, July 24, (THEWILL) – A directive by President Muhammadu Buhari has blocked Nigerian owned oil companies from lifting crude oil in what concerned insiders say is the first step in a larger plot to freeze out indigenous companies which grew their operations tremendously under the previous administration due to the firm implementation of the federal government's Local Content Law.
Instead, THEWILL gathered that President Buhari approved about five international oil companies and traders to lift Nigeria's crude oil under the crude oil term lifting contracts, which is usually done yearly.
THEWILL sources said no indigenous oil trading company including the 28 local firms that won contracts last year are being allowed to lift crude from oil platforms following the presidential directive.
Petroleum sector insiders further told THEWILL that the Nigerian National Petroleum Corporation (NNPC) confirmed the presidential directive to the local companies, which had in the last five years won contracts to lift crude following the expansion of the term lifting contract in order to accommodate more local companies.
The NNPC however did not reveal the identities of the foreign oil companies, we gathered.
At least 15 Nigerian companies with proven competence were technically shut out from lifting crude by the directive, THEWILL gathered, with insiders saying it infringes on the Local Content Law and could lead to the demise of oil companies.
Coincidentally, most of the companies affected are owned by people from Southern Nigeria, particularly the South-East and the oil-rich Niger Delta.
In 2014, the NNPC awarded crude lifting contracts worth about $52 billion to 28 Nigerian companies and 15 international companies, with then Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, explaining that the award of contracts to indigenous companies was done to encourage effective local participation in the industry, adding that the decision was a deliberate policy of the federal government to encourage Nigerians to participate in the oil and gas sector of the economy.
It was not clear as at press time why the President chose foreign oil companies ahead of indigenous firms.
Spokesman for the NNPC, Ohi Alegbe and Presidential spokesman, Shehu Garba, were not immediately available to comment on this report THEWILL called them this Friday morning.