Oando’s IOC Acquisitions Game-Changing, Signal New Era for Nigeria’s Oil Sector, Says Lokpobiri

The Minister of State Petroleum Resources (Oil), Senator Heineken Lokpobiri, on Thursday met with the Oando Energy Resources’ team, stressing that the company’s acquisition of two International Oil Companies (IOCs) in Nigeria remained a game-changer for the oil industry in the country.

Speaking when the Managing Director of the company, Alex Irune and other members of the management team of the oil company visited him in his Abuja office, Lokpobiri stated that indigenous oil companies were capable of taking over from IOCs.

He stated that one of the issues he inherited on assumption of office was the Eni-Oando deal, noting that his aspiration was for Nigeria to create its own IOCs.

“If Oando as a very successful company goes to acquire assets in any other countries, it will become an IOC and that is my expectation and indeed the Minister of Petroleum Resources. We have grown enormous local capacity in companies like Oando, companies like Seplat, and a lot of other companies that are doing well locally.

“And our expectation is that you will sustain this momentum so that in the nearest future, we believe that you will be on the same level with the so-called IOCs that have been with us for the past 60-70 years,” he stated.

He highlighted that Oando has enormous capacity in such a way that if given the desired support, can grow production in a manner that will be a game-changer in the country.

“I have always contended that the future of our oil and gas industry in this country lies with the members of the Independent Petroleum Producers Group (IPPG), of which Oando is a member.

“And I’ve also been asked at a global stage as to whether the indigenous companies have capacity to be able to sustain the running of these companies. The last time I was asked this question was in Davos, in Switzerland. I said we have no problem at all, that we have grown in enormous capacity,” Lokpobiri argued.

He expressed the hope that the companies that are seeking to acquire some of the IOCs will run them professionally and profitably in such a manner that the federal government will lose nothing.

“We’ll still get our royalty, we’ll still get our taxes, and we’ll still sustain the wealth in the country. And so, as minister, my duty is to continue to create the best environment for oil and gas companies to operate in Nigeria. Whether you are an IOC or you are a local company, it’s for me to create the best environment for you to operate in a very profitable and professional manner.

“My expectation is that one day we’ll grow the production and ramp up production of these assets,” he explained.

According to Lokpobiri, Oando will do things differently as an indigenous energy firm, stressing that the firm has to continually show that it has the capacity to outdo the foreign oil firms.

He noted that the oil company must prove sceptics wrong, pointing out that at their peak Nigerians were actually the ones running the IOCs.

“Those who are doing the real jobs are the blacks. And I’m very happy that we have a team here that is 100 per cent black. That shows that you have capacity in-country to be able to do the job.

“That doesn’t mean that when needed you cannot export or import any expats from any part of the world. And I’m looking forward to the time that you do 100,000 barrels per day . And my job as minister is to ensure that I do everything humanly possible to create the best environment for Oando and other companies operating in the Niger Delta region”, he stated.

He argued that the shortest way for Nigeria to get out of its current economic problems is to increase production, explaining that the target is that by December Nigeria’s production will hit at least 2 million barrels per day.

Earlier, Oando had acquired 20 per cent of ConocoPhillips, before its recent completion of the acquisition of the Eni assets in Nigeria.

Speaking earlier,  the Oando Managing Director, Irune, thanked Lokpobiri for the support and committed  leadership, especially in these tough times.

He recalled that Oando started from very humble beginnings, being a downstream company, selling fuel oil in tankers.

“We went into the upstream where we built and have now consummated this deal, the first indigenous company that has acquired two IOCs within its existence.

“The first transaction in 2014, ConocoPhillips was 20 per cent interest in the JV, and now is the conclusion of Eni’s 20 per cent stake making us 40 per cent holders in the JV with the NNPC holding 60 per cent.

“In everything we have done, we have sought to put the best of local content forward, inspire Nigerians to show that Nigerians can do it. IOC is not a concept reserved only for companies from the West, the Far East, and the likes.

“We can breed and create our own IOCs that would have sizeable balance sheets, acreages across the world, and portfolios that can compete with the likes of the Saudi Aramcos of this world, the Shells, Chevrons, and so on. But we must start from somewhere. Oando has started this journey,” he stated.

Emmanuel Addeh

Follow us on: