‘How Addax cost Nigeria colossal loss’

By AdvocateNews on 30/04/2021

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Senator Magnus Abe
Senator Magnus Abe

The lack of investment in the oil field granted to Addax is said to have caused a great loss to the economy, Director, Nigerian National Petroleum Corporation (NNPC), Senator Magnus Abe, has said.

Abe, who was reacting to an online story, said the Department of Petroleum Resources (DPR) was right in its recommendation of a revocation of the mining leases issued to Addax in the national interest.

In the said online story, entitled: “Petroleum Minister, cronies plot kangaroo NNPC report to divert $650 million oil contracts to themselves,” Abe, said the report, was “designed to create the impression of a major scandal and arm twist the Federal Government in the matter concerning the recent attempt to revoke some oil blocks from a foreign company.”

The Senator, who recently headed a Presidential Inter-ministerial Committee made up of technocrats from several federal ministries and departments to advise the President on plight of an indigenous engineering and technology, Kaztec Engineering Limited, explained that Kaztec Engineering, an indigenous firm, was awarded contracts worth over $650 million by Addax Petroleum to develop its oil fields.

Besides, the committee report focused mainly on measures and reliefs which the government can legally extend to the company to salvage the monumental losses to an indigenous company on account of the misdeeds of a foreign firm.

He recalled that in 2015 the Federal Government, under President Muhammadu Buhari, in keeping with its anti-corruption agenda, accused Addax of tax offences, which resulted in substantial losses to the Federal Government.

“Addax was asked to pay, but in response, the firm declared a force majeure on their exploration activities and cancelled their investments in the oil fields. Kaztec, a company that had invested $650 million in the project with Addax, was made to bear the brunt of the dispute, which was actually between Addax Petroleum and the Nigerian government. Over 3, 000 workers were laid off, while equipment, vessels, including a fabrication yard worth billions of naira, laid waste. There is absolutely no scam on oil blocks, or contracts involved in the Kaztec Committee report. Issues of revocation, allocation and management of oil blocks are exclusively the preserve of the DPR,” Abe added.

Posted 30/04/2021 04:15:07 AM


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