Is Agip Above The Law?


August 16, 2015

 I am not a fan of any of the multi-national oil companies operating in the country. The reason for my apparent dislike of the oil giants is both personal and nationalistic. As a Niger Deltan, I have witnessed, firsthand, the crude politics, economic sabotage, environmental degradation and aberrant disregard for the rule of law by these companies who came to our country to do business.



Apart from stealing our oil using every trick in the books, Nigerian oil and gas companies have not been given a fair crack of the whip by their multinational counterparts who have dominated the sector several decades after Oil Well No. 1 was drilled in Oloibiri, Ogbia Local Government Area of Bayelsa State, South-South Nigeria, June 1956.

It was Shell Darcy, now Shell Petroleum Development Company that made the historic find on Sunday, January 15, 1956, while residents of the remote fishing community watched with awe.

Many years after Well No. 1 dried up and Shell moved out, what remains for Oloibiri people are unproductive tangle of rusty pipes, dry farmlands and highly polluted creeks. These are the relics of a once boisterous community. Years of unmitigated oil spills had desecrated the once fertile farmlands where cassava, yam, maize and sweet yam sprouted and creeks which boasted of assorted fish, crabs and prawns.

The people of Oloibiri never got to work or earn decent pay from their oilfield and the royalties paid into government coffers by Shell were never used to develop the area. The excuse then was that Oloibiri and indeed Niger Delta people were not qualified to work in the oilfields and so the indigenes were constantly treated like aliens in the land of their forefathers. Expatriate staff and a few privileged Nigerians in the top echelons of the oil and gas sector enjoy unparallel opportunities and wealth while majority of the people in the Delta region live in abject poverty. For instance, while oil workers live in world-class estates with all the comfort life could possibly offer, the people on whose land the oil is extracted live in shanties and lack basic things like good drinking water, electricity and roads.

I recall how in 2002, ExxonMobil defended its lopsided employment policy against the people of Akwa Ibom on the premise that the people were backward and don’t have the requisite qualifications to earn them top jobs in the company. The tar was brushed on Akwa Ibom people through the mass media and the next day, the people took up arms against the oil firm. Not ready to allow the blackmail and insult rub in, the state government immediately published names of its citizens who were more qualified than some of their best expatriates.

Not long after the appalling incident, a top-notch indigene of the state was appointed ExxonMobil’s general manager, external affairs in 2002. It was the highest position an Akwa Ibom indigene ever got in the multinational oil firm that had exploited oil in the area for decades. Today, no oil company can ever say   Nigerians are unemployable in the sector.

While the country’s oil and gas industry became very active, attractive and booming since the 70s, Nigerians never really benefitted from the development.  It was not until the national content policy was formulated and later the enactment of the National Content Act, 2010, that Nigerians started playing significant roles in the sector.

The Local Content Act as it is also known; applies to all operations in the country’s oil and gas industry including exploration, production and service companies.

Section 3(1) provides that Nigerian independent operators shall be given consideration in the award of oil blocks, oil field licenses, oil lifting licenses and all projects for which contracts will be awarded.

On the other hand, Section 3(2) provides for exclusive consideration to Nigerian indigenous service companies which demonstrate ownership of equipment, personnel and capacity to execute work on land and swamp operating areas.

To ensure that indigenous firms operate significantly in the sector, the law provides that where bids are within one percent of each other at commercial stage, bid containing the highest level of Nigerian content shall be selected provided that the Nigerian content in the selected bid is at least five percent higher than its closest competitor.

It also provides that the award of contracts shall not be solely based on the principle of the lowest bidder where a Nigerian indigenous company has capacity to execute; the company shall not be disqualified on the basis that it is not lowest financial bidder, provided the value does not exceed the lowest bid by 10 percent.

Under labour and employment, the law provides that Nigerians be given first consideration for employment and training in any project by any operator or project promoter in the industry.

Section 35 particularly requires all operators and companies to employ only Nigerians in their junior and intermediate cadre.  Besides, each operator is required to submit a succession plan covering any  position not held by Nigerians with provisions for Nigerians to understudy each incumbent expatriate for a maximum period of four years after which the position shall become Nigerianised; except retention of a maximum of five percent of management positions to take care of the interests of investors.

Unfortunately, multinational oil firms in the country have continued to operate without recourse to the National Content Act.

A typical example is the abrasive violation of Nigerian laws by Agip in its lingering maintenance contract feud with Arco Group, a major indigenous oil and gas servicing company that has over 400 first-rate Nigerian engineers and technicians in its employ.

With absolute doggedness and tact, Arco Group, formerly Arco Petrochemical Engineering Company has during the past 30 years offered quality service to the nation’s oil and gas industry. At the peak of militancy and armed banditry in the Niger Delta, when it was dangerous for expatriates to work the oilfields, Agip and its Joint Venture Partner, General Electric withdrew all foreign staff from the OB/OB, Ebocha and Kwale gas plants and sent them abroad.

It was Arco engineers and technicians that serviced the gas plants till late President Musa Yar’Adua, ended the insurgency in the region and proclaimed Amnesty to the militants.

When Agip and other joint venture partners returned to the plants, they found to their chagrin that the Nigerian firm was able to hold forte and run the turbines without a single incident. The company had during the absence of the expatriates, proved beyond reasonable doubt that it has not only the manpower but also the equipment and the experience to keep the gas turbines running without the supervision of the multinationals. Arco had also proved that Agip and GE had no more business earning billions of dollars doing what the indigenous company can do and even better.

And that was a sin on the part of Arco and the beginning of trouble for its management and staff. From that time, Agip and GE have worked extra hard to oust Arco from the plants built through Nigerian tax payers funds. Nigerian mass media have been awash with reports on how the Italian oil firm has consistently shown disdain towards Nigerian laws and the courts.

But the recent violation of a valid order of a Federal High Court, Port Harcourt, Rivers State, calls to question, the limit the Federal Government could allow a foreign firm to go in disrespecting its laws and institutions. Justice Lambo Akanbi, had issued an order restraining Agip from evicting staff of Arco from the OB/OB, Ebocha and Kwale gas plants, pending the determination of the substantive suit filed before the court.

If reports that Agip and GE are still bent on evicting Arco from the gas plants despite a subsisting court order are true, then Nigerians should rise up and ask the Italian firm and its American partner to leave the country.

Arco cannot end up like Oloibiri which opened its arms and supported the exploitation of its soil and creeks but gets abandoned after years of spinning dollars for multinationals and the Nigerian Government.

Unless Agip and its criminal collaborators are above the laws of Nigeria, then it should be given the same treatment Nigerian firms would get in Italy, United States and any other country where the rule of law is sacrosanct.

Nigeria is not a banana republic. At least the country now has a determined leadership in President Muhammadu Buhari.

Rommy Mom is a lawyer and President of Lawyers Alert, a justice sector human rights group and could be reached on:

rommymom@yahoo.com 08036081967

#ShellBP #Agip #OilExplorationinNigeria #NNPC #MultinationalCompaniesinNigeria #Arco #NigeriaGasandOil #NigeriaLocalContentLaw #GE

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