Senate orders audit of $16bn deep sea oil project

Senators serving as members of the Ad-Hoc Committee on the Investigation of the Local Content Elements and Cost Variations of the $16 billion Egina Offshore Oil Project, have ordered that the account of the contract be audited.

They said it should be audited in terms of value for money to ensure that the country is not trapped in perpetual debt without any benefits.

The project which is undertaken by Total Upstream Nigeria Limited, started in 2013 and is almost about 90 per cent completed. According to lawmakers, it has not been audited insince the commencement of the project estimated to produce 200,000 barrels of oil per day.

Giving the directives at an investigative hearing of the committee, Senator Solomon Adeola, who chairs the committee, stated that tthere is need for a value for money audit, both for technical and financial.

He added that the investigation will assist the values for money audit of the project as well as reveal adherence to local content law and other applicable laws in the industry.

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Adeola stated that the audit and its outcomes will also serve as a guide for other similar projects that are already in the pipeline, stressing, that the audit should be done by an independent body outside Total Upstream Nigeria Limited.

The chairman equally ordered the Nigerian Content Monitoring and Development Board (NCMDB) to provide all relevant Local Content approvals it has granted for the Egina Project, including expatriate quota, trainings and related local content matters.

Adeola said by the regulatory bodies like the Nigerian National Petroleum Corporation (NNPC) ought to have called for audit in the past based on what is contained in the agreement for the Egina Project.

It stressed that until the audit is done, no similar projects would be approved by the Senate.

Earlier, the Chief Operating Officer of NNPC (Upstream), Bello Rabiu briefed the committee on the background and scope of the Egina Project. He however said that the NNPC had not called for an audit, as the project was going on satisfactorily and within the approved budget.

He stated that so far, NNPC has only approved $10.3 billion of the total cost of the project put at $16.3 billion in contrast to about $11.4 billion contained in document of Total Upstream.

By Ehisuan Odia…

 

 

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