By Isaac Arnsdorf – Dec 3, 2013 12:00 AM GMT
News and information on Royal Dutch Shell Plc.
By Isaac Arnsdorf – Dec 3, 2013 12:00 AM GMT
Relieved: For Zik: You are being a bit long-winded, buddy.
Zik Gbemre: SHELL SALES OF OIL BLOCKS – WHAT IS THE BENEFIT TO HOST COMMUNITIES OF NIGER DELTA? The Royal Dutch Shell is at it again as it has concluded the sale of its four Nigerian onshore oil blocks–Oil Mining Leases (OML) 18, 24, 25 and 29 – in addition to the Nembe Creek Trunk Line (NCTL) - which it put up for sale following a 2013 review of its business in the country. According to a report, in an effort to reduce its exposure to onshore operations, which are more prone to security threats, Shell is divesting 30 per cent of its interest in the four blocks, while Total and Eni are selling 10 per cent and five per cent respectively. The remaining Fifty-five per cent will be retained by the Nigerian National Petroleum Corporation (NNPC) under a Joint Operating Agreement (JOA) with the new buyers. The divestment is also part of the Anglo-Dutch giant’s plan to dispose of $15 billion of assets globally in 2014 and 2015. The problem we have with all of these concluded sales by Shell in its Western-Nigeria operations and now the Eastern operations is that it has no direct benefits to, or role by the host communities that have been bearing the brunt of the extractive industry for over fifty decades now. On the Divestment of Shell (SPDC) onshore assets in the Niger Delta region, Shell initiated this process which according to them, was to help grow local capability. Oil blocks in Shell’s Western operations in Nigeria were sold to mostly Nigerian companies who were in partnerships with foreign funding and technical partners. But neither the host Delta State Government nor local communities were considered in these as partners, and this generated a lot of community backlash with threats from local communities to block operations. There were protests in the oil city of Warri and other places but all to no avail. Now the same thing has happened in the East; in Bayelsa and Rivers States. Again, there are no indication of direct role for, or benefits to the host communities that have borne the brunt of the devastation and exploitation for all these years of oil and gas exploration and production. Plans are on for OML 11 & 17, some of the wells are in Ogoni, which has witnessed the most destructive evidence of environmental pollution from oil and gas exploration and production that are yet to be resolved till today. The question is, should the Nigerian government just allow these sales to go on without prescribing equity participation for the communities as a way of compensating them? Buyers of these fields become extremely wealthy. Is there anything wrong with the host communities of the Niger Delta being extremely wealthy as well? The sale of these four assets will bring the number of oil blocks sold by Shell to 12 in the last four years, as the oil major had previously sold OMLs 4, 38, 41, 26, 30, 34, 40 and 42 to local investors and their international partners. Of the eight oil fields previously divested by Shell, only OMLs 4, 38 and 41 are operated by the new buyer, Seplat Petroleum Development Company, while the operatorship of the other five blocks were transferred to the Nigerian Petroleum Development Company (NPDC), the upstream subsidiary of the Nigerian National Petroleum Corporation (NNPC). Under the current divestment programme, the report noted that Shell signed a Share Purchase Agreement (SPA) with the Aiteo Group, which is acquiring OML 29, the most prolific of the oil assets offered to buyers, and the Nembe pipeline recently in Lagos, Nigeria. Other partners in the Aiteo Group-led consortium include Tempo Energy Resources, which has a 10 per cent stake and Taleveras with five per cent equity in the consortium. The disposal of the Nembe pipeline, which moves oil through the Niger Delta to the Atlantic coast, is seen as Shell’s biggest move yet to exit onshore crude production in Nigeria. The 60-mile Nembe Creek Trunk Line is one of Shell’s two key pipelines in the Eastern Niger Delta, which the oil giant replaced in 2010 at a cost of $1.1 billion. The company also said recently that alongside its partners, Total and Eni, it had signed an SPA to sell 45 per cent in OML 18 to a consortium led by Canadian oil and gas company Mart Resources. Reuters reported that Mart Resources confirmed that it had entered into an agreement recently for the acquisition of OML 18, whose production it said ranged between 20,000 to 30,000 barrels per day from around 30 wells. Mart Resources is part of the Erotron consortium that won the bid for OML 18. Its other partners include indigenous operator Midwestern Oil and Gas and Suntrust Oil. The sale process “has not yet fully concluded but we can confirm that we have now signed the share purchase agreements for these oil mining leases and the NCTL,” a Shell spokesman said. “Nigeria remains an important part of Shell's portfolio, where we will continue to have a significant onshore presence in oil and gas, and which has clear growth potential, particularly in deep-water and onshore gas,” he added. For OML 18, the Erotron consortium was reported to have offered $1.2 billion for the oil block; Aiteo offered $2.562 billion for OML 29 and the Nembe pipeline; Pan Ocean Corporation Nigeria Limited offered to pay $900 million for OML 24; while Crestar secured OML 25 having offered $500 million for the oil asset. However, despite the execution of the SPAs between Shell and the buyers, the transactions would only be deemed truly sealed after a ministerial consent is granted by the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, as provided by the Petroleum Act. However, the buyers have expressed confidence that the Minister would sign off on the deals soon. Again, looking at all of these oil block sales by Royal Dutch Shell in the Niger Delta of Nigeria, the big question is; in what way would these benefit the host communities [...]
Texvette: Finally - is it wishful thinking about Odum's long overdue departure or is it based on fact ?
On The Job (Corrib): Just read an email ,Shell expose OSSL for dumping toxic waste across the border in N Ireland ,brilliant deflection from Garda Booze nice one Shell .
Corrib House Circus .: Current Shell Senior operative on Corrib yesterday released (in writing) a malicious statement regarding the driver of the police /Shell 2007 alcohol delivery .The release of the grotesque completely erroneous statement is timed to counter the news that the Minister for Justice is welcoming a reopening of the investigation into the "cops booze " claims . We now plumb the depths like never before .BVB must act to halt this villainous behaviour from Shell Ireland .
Relieved: If Odum does go he goes 4 years early. Mandatory retirement is at age 60. Odum is 56.
Finally: It looks like Odum will finally be given his marching orders. I wonder if we will see other casualties of the CEO shake up. I'm glad I don't have the letters UA in my ref indicator at the moment. Its been a long-time coming.
Malaysia Boleh: Let me tell you about one of the mess in Malaysia too. We made a mess of the Gumusut leased contract, damaged our relationship with Petronas. Now Ashley Bates CP GM got promoted to be VP CP. He is helped by non other Top Shell salesman Wayne H . Russ you have been conned. Get Ashley to sort out the mess before he goes. Ask the business for feedback. Don't trust Wayne too much.
Relieved: In the US the kind of legal shenaningans this 'CW Law' gang pulled would get someone disbarred might even lead to criminal charges for the individuals involved and the law firm itself. And you have to love RDS for trying to pull this kind of sleazy legal hat trick. RDS is such a good corporate citizen. None better.
Houston cowboy: Why is Peter Sharpe EVP Wells not made accountable for the Arctic belly flop? Everyone just blame the Americans.. Time to get someone new in drilling to turnaround Wells performances.