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Oil Block Renewals: CSOs Task FG On Openness, Beneficial Ownership

A group of Civil Society Organizations (CSOs) have called on the federal government to ensure that the highest standards of transparency and accountability are applied across the entire process of re-awarding or renewal of currently expired and about-to-expire oil block licenses in the country.

The groups which include Policy Alert, Human and Environmental Development Agenda (HEDA), Civil Society Legislative Advocacy Centre (CISLAC) and 19 others, in a statement issued in Abuja, emphasised that openness should cover all stages of the contracting process.

Quoting the Department of Petroleum Resources (DPR) 2017 Oil and Gas Industry Annual Report, the group noted that a total of 42 oil block licenses held by international and indigenous oil companies are due for renewal in the year 2019.

The licenses consist of 35 Oil Mining Licenses (OML) and seven Oil Prospecting Licenses (OPL), some of which have already expired between August and September, while others are due to expire this October.

According to the CSOs, Nigeria has lost billions of dollars in potential revenue due to the continued refusal of government to conduct an open and competitive bid round for oil blocs in the country, noting that the country especially missed the opportunity of conducting a licensing round during the oil boom years of 2010 to 2014.

“In the last 12 years, no competitive oil licensing round has been held for Nigeria’s oil blocks, and even those before that period were riddled with controversy. The executive discretion, cronyism and lack of openness that have characterized decision-making around the award of blocks over the years have driven down competition, fuelled massive corruption and adversely affected returns to Nigeria from the sector,” the statement said.

It added that “The expiration of these licenses therefore provides a critical opportunity to emplace mechanisms that will guide the future management of the sector so that Nigeria can begin to benefit fully from her natural resource wealth and translate same to better development outcomes for citizens.”

The statement further noted that contract transparency is now a key requirement of the Extractive Industries Transparency Initiative (EITI) of which Nigeria is a leading implementing country, and aligns with Nigeria’s open contracting commitments at the 2016 UK Anti-Corruption Summit and via the Open Government Partnership (OGP).

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