Reps, DPR bicker over revocation of Dawes Island marginal oilfield

The house of representatives committee on public petitions have disagreed with the Department of Petroleum Resources (DPR) over the revocation of Dawes Island marginal field from Eurafric Energy.

In April 2020, DPR revoked 11 marginal field operators licence for non-performance, including Dawes Island marginal field in OPL 2006, Rivers state.

Eurafric filed a motion on notice challenging the revocation and applied for an interim injunction restraining the revocation.

In June 2020, the federal high court in Lagos restrained the ministry of petroleum from selling or accepting bids for eight marginal oilfields, including that of Dawes Island pending determination of a suit challenging its status.

The regulatory agency had awarded the oilfield to Petralon 54 Limited and its partners during the last marginal oilfield bid round.

Similarly, Eurafric sent a petition to the house of representatives to counter DPR’s action.

In the petition, Onoriode Odjegba, managing director of Eurafic Energy, said due to restiveness in the Niger Delta region, the company could not access the marginal field and thus it suspended the field development plan (FDP) and other activities around the field till 2011.

Odjegba said the return to the field was completed in June 2016, and that the company had spent $35 million and was able to produce 60,000 barrels of crude oil.

However, DPR justified the revocation, explaining that “Dawes Island marginal field was operated by Euroafric Energy Limited for over 16 years without significant progress to attain full production and failure to submit a field development plan for the asset”.

According to Sarki Auwalu, DPR director, the decision was taken in the best interest of the nation.

The lawmakers reversed DPR’s award of the marginal field to Petralon 54 Limited, explaining that the agency’s action was not done in the interest of equity and fair play.

They wondered why DPR punished two members of the joint venture (JV)– Eurafric and Tako and yet rewarded one member (Petralon) for the purported joint failure of the venture after it was cancelled in April 2020 for alleged non-performance.

In its ruling, the committee said that since the DPR had admitted the JV relationship between Eurafric, Tako and Petralon, in the interest of peace and harmony, all three parties should benefit from any re-award of the licence.

This is not the first time DPR will revoke an oilfield that was restored back.

In April 2021, it revoked four oil mining licenses (OML) belonging to Addax Petroleum due to the non-development of the assets by the petroleum company.

However, President Muhammadu Buhari ordered DPR to retract the revocation of Addax assets “in line with the current administration’s commitment to the rule of law, fairness and enabling a stable business climate for investment”.