Impeccable sources with the Nigeria Oil and Gas regulator, the DPR has alleged that Emeka Offor’s company, Eland Oil and Gas Nigeria Limited is at loggerheads with the Nigerian regulator and the Operator of the Opuama field at OML 17 on regulatory matter concerning crude export from the beleaguered asset.
The DPR source claimed that Managers and Directors remain perturbed with this unwholesome trend since this will be the second time in less than a year in which Companies’ associated with the UK stock exchange will take the unconventional route of taking the Buhari-led Government to court over the insistence of the regulator in following laid-down regulations.
As at press time, the powerful operator of the field, the operating arm of the NNPC is carefully studying this case and may decide to enforce their operatorship of the field, which is currently jointly-managed by both Companies.
The DPR source quipped that “Eland needs to know that the era of the erstwhile Managing Director, Yusuf Matashi has gone and that the new hands at the helms of affair, the inimitable Usman Yusuf will not allow any foreign company to push him around”.
The Minister of Petroleum,
President Buhari is also a no-nonsense man and will frown at the Dublin-based Company’s efforts to smear his incorruptible personae.
E&P legal and financial professionals conversant with the unfolding story believed there has to be more than meets the eye in the disharmony since the issue at heart between Eland and the DPR is mainly procedural and should not have led to litigation by the Company.
The experts opined that Eland may
have pledged some of the reserves that belong to NPDC in its attempt to secure the $50 Million accordion facility with Standard Bank of South Africa.
An accordion facility is essentially an incremental facility, which allows a borrower to take an additional facility over and above what was originally agreed with the financier on the same terms as the original facility for expansion purposes.
The financial adviser recalled that the Company is expected to commence principal repayments on its existing 5-year reserve-based lending facility by the fourth quarter of 2019.
This is consistent with the
one-year grace period on principal repayments from execution of the facility, which occurred in
Insiders to the deal believe that the company may be cash-strapped since the November 2018 loan has not been deployed efficiently, mainly owing to the many rig mechanical failures with the Gbetiokun drilling campaign, the below-par production from its new wells, and the increasing water handling challenges from the field.
“Don’t you see that the Company has been using the loans to continuously buy back its shares to shore up the UK shareholders’ values at the expense of
NPDC and the Government?” lamented the expert.
The unusually erratic behaviour of the Les Blair-led company makes the expert believe the Company may be facing an existential crisis due to Standard Bank’s insistence that Eland Oil and Gas meets all conditions precedent to the drawdown of the loan.
This may explain the desperation of the Company to claim the Operator’s reserves with its own to increase access to the facilities.
The DPR sources further claimed that the department keeps complaining that its legal staffs are stretched thin already and does not welcome this unnecessary challenge by Eland.
The sources claimed that the Company needs to tread carefully since Emeka Offor needs to maintain cordial relationship in the corridors of power to ensure its does not jeopardize its interest its other fields and future licensing rounds.
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