OML 98: Pan Ocean, other investors’ interests will be protected – DPR

The Department of Petroleum Resources (DPR) said on Monday the stakes of Pan Ocean Oil Corporation (Nigeria) Limited and other investors are safe following the transfer of the ownership of the Oil Mining Leases (OML) 98 from the former to the Nigerian Petroleum Development Company Limited (NPDC).

The revelation came at a meeting between the representatives of the DPR, the Nigerian National Petroleum Corporation (NNPC), NPDC and Pan Ocean in attendance held on February 14 as part of the asset handover procedure.

Just last Friday, the Federal Government handed the licence in question to the NDP, itself the upstream subsidiary of the NNPC, a year after it was revoked for breaching royalty payment terms.

In the eight months to date, Pan Ocean has strived to ensure a smooth transfer of the assets.

The Director at DPR, Sarki Auwalu, promised stakeholders that the midstream assets on OML 98 and those associated with the mining lease would continue to deliver value to stakeholders.

He added that the outstanding operational costs incurred by the NNPC/Pan Ocean JV would be accorded the attention they deserve after verification.

Auwalu directed the NNPC/Pan Ocean JV to sort out the staff issued associated with the asset while pointing out that legacy debt on the asset would be settled amicably.

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He said: “The equity and economic interests of all investors are recognized. We will ensure that no one is short-changed. Everyone will recoup their investments on all the assets and no investor will be discouraged.”

“Pan Ocean must work together with the new owner of OML 98, especially on the midstream assets. OML 98 cannot be operated efficiently and profitably without the midstream assets.”

The DPR director said a letter would be delivered to Pan Ocean in the next few days to assure the company about the security of its assets and equity.

While reassuring the regulators of Pan Ocean’s commitment to a smooth transition, Mr. Olajide Ishola, Chief Operating Officer, Pan Ocean, said: “Since last year when the revocation of the asset came into effect, a lot of things were left in limbo. This meeting sets the tone for the handover and future of the asset. In the months ahead, we will continue to work closely with regulators to ensure that there is no significant disruption in production as a result of the change in ownership.”

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