- Licensing of oil blocks in the Nigeria, São Tomé and Príncipe Joint Development Zone (JDZ) is set to resume after a delay of five months. The delay came after a scandal involving corruption charges and the temporary resignation of São Tomé's Natural Resources Minister Arlindo Carvalho, which only ended after the personal intervention by Nigeria's President Olusegun Obasanjo.
Government officials in São Tomé and Príncipe today told the press in Nigeria that there was reached an agreement on going on with the JDZ licensing process of five oil and gas blocks in their jointly administered waters. Final decisions on the new awards could now be announced within a short time, the official indicated after having met his Nigerian counterparts.
The licences of the five blocks were originally to be awarded in January this year, but the JDZ's administration agency could not come up with a decision at that stage. This rapidly caused speculations on a possible power struggle between the different interests represented in the agency and its overall integrity.
In particular the relatively small and unknown US-based Environmental Remedial Holding Corporation (ERHC) has been at the focus of possible corrupt practices at the Joint Development Authority (JDA). ERHC had obtained preferential rights on the most promising blocks during the first licensing round, which it now was to make use of.
According to investigations by Nigeria's independent press, a company belonging to Nigerian businessman Emeka Offor holds around 50 percent of the shares in ERHC. Mr Offor is reported to have had close links with Nigeria's former military dictator Sani Abacha and ERHC has never documented any oil exploration or drilling experiences from other parts of the world.
While the "oil company" originally was brought aboard by the São Toméan government in a 1997 contract, current President Fradique de Menezes is reported to be eager to exclude ERHC from further oil deals in the JDZ. President Menezes is further accused by the São Toméan opposition of abusing his double role in the national Petroleum Council and receiving cash from other Nigerian-controlled bidders.
The apparent power struggle in the JDA had paralysed its awards of five new blocks for five months, causing São Tomé's Nigerian partners to lose patience. President Menezes fired his adviser on petroleum issues, Patrice Trovoada, accusing him of furthering his private business interests and delaying the award process. Another adviser, Manuel Rita, was also sacked after it was known he owned shares in ERHC.
São Tomé's Minister of Natural Resources, Arlindo Carvalho, last week found it was impossible to continue working in the current environment of suspicions and allegations and resigned from his post. The resignation was however not accepted by President Menezes, who reiterated his confidence in Minister Carvalho.
Given the chaotic situation in São Tomé and Príncipe, Nigerian President Obasanjo on Friday went on a quick visit to the nearby archipelago. During a three-hour stay, the Nigerian President met with President Menezes, Prime Minister Damião Vaz d'Almeida, a parliamentary commission on petroleum issues and representatives of the JDA.
President Obasanjo, who was visibly irritated over the necessity to go to São Tomé, had advised his colleagues against "politicking with purely technical matters." Other Nigerian politicians feared the JDA would lose its good reputation and indicated that economic stakeholders in São Tomé were jealous of the large Nigerian business involvement on the new blocks.
The Nigerian intervention nevertheless led to the rapid regrouping of the JDA, and reinstated São Toméan Minister Carvalho has already announced that the licences most probably will be awarded in a JDA meeting very soon. Nigeria gets 60 percent of the oil revenues from the JDZ, while São Tomé gets 40 percent of revenues.
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