Royal Dutch Shell Plc  .com Rotating Header Image Nigeria: Shell Battles Etete Over Oil Block

This Day (Lagos)
2 July 2007
Chika Amanze-Nwachuku

Shell Nigeria Ultra Deep Limited (SNUD) yesterday threw more light on the dispute between it and Malabu Oil and Gas Limited, a company owned by former Minister of Petroleum Resources, Chief Dan Etete, over the ownership of an Oil Prospecting Licence (OPL245).

SNUD insisted that the acreage licence was awarded to it in a competitive Production Sharing Contract (PSC) bid round in 2002.
The oil block licence granted to Malabu in 1998 was revoked by the Federal Government in 2001, after which it was awarded to SNUD, Malabu’s former technical partner.

But following an out of court settlement of the six- year old dispute, the Federal Government last month restored the block back to Malabu.

Malabu, had in the wake of the withdrawal of the oil block licence, accused SNUD of being the brain behind the revocation because of its interest in the block.

Consequently, the company instituted several litigations against the Federal Government and SNUD, claiming that the action was taking in bad fate.

But dissatisfied with government’s decision to restore that oil block licence to Malabu, Shell approached a Federal High Court in Abuja to set it aside, insisting that it was never a party to the out of court settlement.

The Communications Manager of Shell Nigeria Exploration and Production Company (SNEPCO), Mr. Tony Okonedo, stated that SNUD rejected the purported out of court settlement and is currently challenging it in court.

While maintaining that the oil block licence was issued to his company after due process, Okonedo said there was no iota of truth in Malabu’s allegation that his company instigated government’s revocation of the acreage licence, as according to him, SNUD participated and won the bid for the oil block in an open exercise conducted in 2002.

He explained that SNUD, after the bidding, became PSC contractor to the Nigeria National Petroleum Corporation (NNPC), a contract, which he said, his company had been actively executing.

Malabu Oil and Gas had at the weekend maintained that Shell was instrumental to the revocation of its oil block licence in 2001 and affirmed that it had filed a preliminary objection to Shell’s suit before the court.

Addressing newsmen on the matter, Malabu’s Company Secretary, Mr. Rasky Gbenigie, vowed that the company would resist moves by Shell to continue to act as a clog in its (Malabu) efforts to develop and realise the full potential of the oil block.

He argued that Shell could not have been a party to the settlement agreement because the issue of ownership was a dispute between Malabu and the Federal Government, adding that it was in pursuance of the terms and conditions of the grant of the OPL 245 to Malabu that it (Malabu) sought the technical partnership of Shell, which the indigenous company also assigned 40 per cent participating interest as its technical partner.

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