Aiteo Pays DPR $82m to Renew OML 29 Lease for 20 Years

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Chineme Okafor in Abuja

Documents obtained Saturday in Abuja by THISDAY have shown that indigenous oil and gas company – Aiteo Group, has completed its payment of $82 million to the Department of Petroleum Resources (DPR) for the renewal of its operational lease on Oil Mining Lease (OML) 29.

According to the documents, the company on January 22, 2019 reportedly made the last and final payment of $18, 23,000.00 to the DPR to bring the total amount of payment for the renewal of the oil block for another 20 years to $82,006,468.23.

One of the documents contained the spread of the payment to the DPR in the ratio: $18,455,000.00 paid on January 22, 2018; $9,227,500.00 and $9,227,500.00 both paid on January 22, 2018 and November 6, 2018. Another sum of $20 million was also paid to the DPR by Aiteo on December 18, 2018 and $6,866,468.23 paid on November 14, 2018, and then $18, 23,000.00 paid on January 22, 2019.

A letter to the Director of the DPR, Mr. Mordecai Ladan, by the Executive Vice Chairman of Aiteo, Mr. Benedict Peters, intimating him of the full payment, and which contained an acknowledgment stamp of the DPR was also sighted by this paper. The letter was dated January 23, and DPR acknowledged receipt of same on January 24, 2019.

It was recently reported that the energy firm was struggling with repayments of some debt and may not meet up with the renewal fee of the prolific OML 29.

However, the documents indicated Aiteo had taken a huge step towards securing its control of the asset for another 20 years with its full payment of the renewal fees.

Sources in the company also told THISDAY that besides the full payment of the renewal fees, the company has also met all conditions precedent for the renewal of its oil mining license.

“Most importantly, it has finalised payments of the sum of about $82 million to the Department of Petroleum Resources in respect of the license renewal. Aiteo paid the renewal sum in six tranches, with the last payment made on 22 January 2019, exactly a year after the first instalment.

“Sometimes, you have to make moves in silence and let your success makes the noise. This seems to be the strategy Aiteo might have deliberately or unintentionally embraced. Ever since Aiteo won its lucrative oil exploration contract, it has had to combat with those who will stop at nothing to bring it to its knees. In many instances the false assertions are similar, while some are just out rightly ridiculous,” said the highly placed source who pleaded for anonymity.

Accordingly, OML 29 is a large block located in the southeastern Niger Delta. It contains 11 oil and gas fields, which include the Nembe; Santa Barbara; and Okoroba oil fields.

The OML was reportedly first leased to Shell Petroleum Development Company (SPDC) in 1964, and renewed for 25 years until 1989, and then for another 30 years which terminates in June 2019.

However, Aiteo Exploration and Production (E&P) Limited emerged the preferred bidder and operator in 2014 after a competitive bidding process undertaken by the Royal Dutch Shell, ENI Group and Total of their combined 45 per cent interest in the OML. Aiteo also acquired a related facility, the Nembe Creek Trunk Line (NCTL), a 100 kilometres long pipeline with the capacity to transport 600,000 barrels per day (bd).

Similarly, the source told THISDAY that upon takeover of the operatorship of the asset, Aiteo ramped up production from the lease area from a meagre 23,000bd to a peak of 100,000bpd within a year.

“This enviable performance was equally given impetus by the entrepreneurial spirit of founder Benedict Peters, who amidst collapsing oil prices, remained determined to demonstrate the tenacity of Nigerian entrepreneurship. Benedict Peters is one dogged entrepreneur who has also risen above a shadow of controversies to prove himself as an African business leader,” the source added.