Senate clears legal hurdles hindering Mambila project’s take off

 

. Urges oil and gas companies to relocate to Niger Delta

 

Adekunle Adesuji, Abuja

 

 

The Senate on Monday, disclosed that all  legal hurdles hindering the smooth take off of the Mambila Hydro Electric Power projects had been  resolved saying the contractors are expected to mobilise men and materials to site before the end of the year.

 

Chairman, Senate Committee on Local Content, Senator Teslim Folarin, made this known while receiving

the report of the finance sub committee of the Mambila Hydroelectric Power projects.

 

He said the subcommittee was an off shoot of the Technical Working Group on Mambila Hydro-Electric Power Local Content, which inaugurated in June, 2020.

 

The Federal Executive Council on 30th August, 2017, approved the contract on the Mambila Hydro Electric Power Project in the sum of $5.792 for the construction of 3050MW.

 

The project was awarded to Chinese contractors JV (CGGC-SHC-CGCC), with the site in Gembu, Taraba State.

 

Folarin noted that the challenges that emanated in the course of the execution of the project, made the Presidential Committee on North-East Development  now the North East Development Commission to review the initial plan of the Technical Working Group.

 

He said the NEDC came up with a working document, where in the work of the TWG was reshaped and streamlined for effective and seamless implementation of the project.

 

He said, “Thereafter, the reviewed report was forwarded to the National Assembly for further legislative action.

 

“Consequently, the National Assembly along with the Technical Working Group, constituted the Finance Sub-Committee under the Chairmanship of the Executive Director, NEXIM Bank.

 

“The Sub-Committee was inaugurated earlier this year by the Senate Committee on Local Content and it was mandated to report back to the Committee within six weeks.”

 

The Senator said the subcommittee

was mandated to work out modalities that would facilitate the financial requirement of the local content aspect of the project, which was estimated at N1.7bn representing 30 per cent of the approved contract of $5.7bn.

 

He said, “The Nigerian Export and Import Bank was mandated to play the lead role in the sub-committee, while the Nigeria Sovereign Investment Authority was to serve as the secretariat of the panel.

 

“I have no doubt in my mind that all these issues, among others, are succinctly addressed in the report  and I believe that at the end, we shall have a document that will provide a way forward on the project.”

 

Speaking with journalists after the presentation of the report,

Teslim said the major legal incumbrance which had made it almost impossible for the legacy project to take off, had been resolved.

 

He said, “We have made some progress and breakthroughs, but we are yet to forward the report to the leadership of the Senate.

 

“The Federal Government was mandated to pay to the contractors, (Sunrise) $200m and if we don’t pay within a stipulated time, then we have accrued interest.

 

“As far as the contractors are concerned, they said their money is now $400m because of the accumulated interests .

 

“The project was officially awarded by the Federal Executive Council on August 30, 2017, and it has been signed as a contract between the Nigerian government, ministry of power and the Chinese Joint Venture of CGGC.”

 

The Liaison officer and administrator for Hypertech, the consultant to Federal Government and Chinese Government on the Mambila project, Mrs Maimuna Muhammed, also said all litigation had been effectively resolved.

 

She said, “We have a breakthrough concerning all the litigations about the project. All the delays we had before everything has been sorted out.

 

“Now we are ready to kick start the project. The next programmes we are going to have is the Business Roundtable, after that we move to site, in Taraba.State.”

 

Also speaking with journalists, the Consultant to the Senate President on Mambilla HEPP Local Content, Muhammad Mustapha, said membership of the committee also consists of the technical committee which was chaired by ministry of power and co-chaired by ministry of water resources.

 

He said the human capital development committee that was chaired by the Petroleum Technology Development Fund co-chaired by the energy council, was also involved.”

 

Muhammad added that part of the challenges that had caused significant delay over time had been the legal incumbrance.

 

He said, “We will like to mention that qualifying the efforts of this committee as local content, been able to identify the legal aspect of the project to be a local content concern.

 

“The pre commencement activity has been already approved two years before now.

 

“Part of the effort of the finance sub committee is to articulate the local content aspect of the project as a whole and the pre commencement activity in specifics.

 

“This activity stands at four major areas: the security of the site, access road to open up the site, the resettlement plan of over 140,000 people and air field for logistic base.

 

“We call on the implementation committee to work assiduously to meet the six week timeline as the project is building a new political momentum toward implementation.”

 

Meanwhile ,Senate, on Tuesday, ordered it’s standing Committees on Petroleum Resources Upstream; Downstream Petroleum Sector and Gas to liaise with the Ministry of Petroleum Resources and the Presidential Implementation Committee

on the Petroleum Industry Act (PIA), to facilitate the relocation of the oil and gas companies back to Niger Delta region which was their operational bases.

 

 

Senate’s resolution was sequel to a motion sponsored by Senator Albert Basset Akpan in  a motion titled: “Urgent need to encourage all multinational and Nigerian oil and gas companies to relocate to their operational bases”.

 

 

Leading debate on the motion, Akpan in  urged the Senate to note with concern that multinational and Nigerian oil and gas companies have over the years been operating from their respective operational bases until militancy and insecurity in the host communities in the Niger Delta became the order of the day.

 

Akpan added: “Also notes that the reason proffered by the oil and gas companies for not relocating to their host communities has always been due to insecurity and hostilities in the host communities.

 

“Aware that operating outside the host communities and operational base is the reason for the high cost of production which has been the bane of the country’s oil and gas industry, militating against maximum revenue from crude oil and gas sales to the Federation Account.

 

“Recalls that this high cost of production has been one of the most contentious elements of our petroleum industry value chain.

 

“Convinced that the recent passage and signing into law of the Petroleum Industry Act, 2021 (PIA) by the National Assembly and the President of the Federal Republic of Nigeria respectively, is a major milestone towards the restoration of a lasting peace in the host communities.

 

“Further convinced that the Petroleum Industry Act, 2021 now places certain responsibilities on the security, peace and safety of oil and gas infrastructure on the host communities to safeguard and ensure peaceful coéxistence between oil and gas companies and their host communities.

 

“Further convinced that (the relocation of oil companies to their operational bases) is an opportunity to restore, recover and rehabilitate the massive and huge infrastructural facilities abandoned by the various oil and gas companies in their various operational bases to ensure their full utilization; and

 

“Assured that the relocation of these companies to their host communities will further boost development in

those areas and enhance the corporate social relationship and strengthen our collective resolve to considerably reduce the contentious cost of production and ensure adequate returns to the federation account.”

 

 

It could be recalled that Most multinational and Nigerian oil and gas companies operating in the Niger Delta had relocated their headquarters and operational bases to Lagos, citing security concerns and restiveness in the Niger Delta.