January 31, (THEWILL) – The Nigerian National Petroleum Company Ltd (NNPCL) has terminated the Production Sharing Contract with Addax Petroleum on four oil blocks.
The Chief Upstream Investment Officer (CUIO), NNPC Upstream Investment Management Services (NUIMS), Bala Wunti, made this known at the ‘Final Close-Out of the Addax Transfer, Settlement and Exit Agreement’ held at the NNPC Towers in Abuja.
NNPC Ltd said with the fulfilment of the closing obligations by the parties and effective January 31, 2023, Addax transfers the operatorship of OMLs 123/124 and 126/137 to Antan Producing Limited on an interim basis through the transition period pending the emplacement of a substantive replacement PSC in compliance with the directive of Mr President.
Speaking at the event, the Group Chief Executive Officer of the NNPC Ltd, Mele Kyari, said the termination of the Addax PSC marks a new dawn for the oil blocks.
He said the amicable settlement is a clear message to the world that Nigeria is willing to attract investments in the oil and gas sector.
“Today is a great day for us at the NNPC, we have drawn to a close a very very long dispute over the Addax Plc. Today, it has come to end as clearly directed by Mr President, NNPC in its wisdom has made sure that this amicable arrangement is in place so that we take over the operations of these assets and put up the necessary framework for the operation of these assets to be beneficial to the benefit of our country and others.
“Of course, this is a message to the whole world that our country is a very reliable physical environment. We keep to our agreement and also, as a country, we are ready for business.
”We believe this closure will also further and soften the already cordial relationship between the people’s Republic of China and Nigeria,” he said.
Bala Wunti, in his remark, said before the takeover of the assets, only two of the oil blocks were producing.
He, however, said that everything necessary has been done to ensure peaceful transfers of disputes as required by the terms of the agreement.
He said, “Out of these four OMLCs, two were producing. Since taking over these assets, its production has grown from 6000 barrels to 16,000 barrels combined from the two assets and we have recorded zero downtime since then.
“This wouldn’t have been possible without the collaborative support of the Addax management.
“We have been able to achieve the technical component of the agreement. It involves transferring 179 that are required; currently being used to operate Addax.
“That is excluding terms that says we will cancel them. We are transferring 81 cases and disputes at different levels.”
He noted that everything has been done to achieve the Presidential mandate.
The outgoing Managing Director of Addax, Yonghong Cheng, said the agreement has “achieved a win-win outcome,” adding that “This demonstrates the power of cooperation, which has resulted in the restoration and the strengthening of the relationship between NNPC and Addax on one hand and our parent countries, Nigeria and China, on the other hand.
“We have achieved this important milestone. This is good for all of us. I will like to thank His Excellency, President Muhammadu Buhari, for his leadership on this issue and his support for foreign investors and also appreciate the management of NNPC Ltd and the leadership of the able GCEO, Mele Kyari, for his commitment and focus towards achieving this.”
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