The richest woman in Nigeria and also one of the richest in Africa, Folorunsho Alakija, got tongues wagging, when she revealed what looks like her road to success which included how she was able to acquire an Oil Bloc.
Alakija claimed in a series of tweets, how God that orchestrated her involvement in the oil industry.
“It is only God who could have brought me from the back burner to the front burner.
“He Himself orchestrated and organized, by divine intervention, the beginning and continuation of our delving into the oil industry.
“The oil bloc allocated and licensed to us was not wanted by any oil company; we accepted it by faith and it has become the chief cornerstone in West African and Africa as a whole.
“The Government came back to “take” 50% out of our 60%, but after a 12 year battle in Court, all was restored to the glory of God.”
Her revelations did not appear factual to many, who accused her of acquiring her bloc through connections and illegal means, while some opined she should have kept silent, rather than painting a narrative that is far from the truth.
How did Alakija got her Oil Bloc?
Oil Bloc also known as oil field is known as a region with an abundance of oil wells extracting petroleum (crude oil) from below ground. It’s a tract of land used for extracting petroleum, or crude oil, from the ground.
In 1993, Alakija, under her company, Famfa Limited, reportedly applied for the allocation of Oil Prospecting License (OPL), to explore for oil on a 617,000-acre block which is referred to as OPL-216, and she was granted.
The bloc is located approximately 220 miles South East of Lagos and 70 miles offshore of Nigeria in the Agbami Field of the central Niger Delta.
The operator of the field is Star Deep Water Limited, an affiliate of Chevron.
Famfa got its oil license as a result of President Ibrahim Babangida’s drive to encourage Nigerian participation in the exploration and production of oil, as it was largely dominated by International Oil Companies (IOCs).
The then Minister of Petroleum, Professor Jibril Aminu, initiated a process of awarding licences to Nigeria companies that possess the financial capabilities and technical resources to carry out E&P activities.
The blocs were not allocated freely as the recipients were reported to have paid a signature bonus of at least US$1.5 million for the license.
The Oil Bloc nobody wanted
True to what Alakija said, OPL 216 was reportedly rejected due to its location and deep offshore area in the Gulf of Guinea in water depths of over 1,300 metres (1.3 kilometres).
The bloc was stated to have no proven reserve, and required significant capital to explore and develop. There were no Floating Production Storage and Offloading (FPSO) terminals available then.
In 1996, Famfa Oil entered into a Deed of Agreement (DoA) with Star Deepwater (Texaco), in which Star Deepwater was assigned 40% participating interests in OPL 216. Someone familiar with the story claims Star Deepwater entered into the DoA extremely reluctant, considering the uneconomic status of the bloc.
In 1998, Petrobras of Brazil acquired 8% of Texaco’s 40% interests.
Case with Government
In 2000, former President Olusegun Obasanjo Government, through the Nigerian National Petroleum Corporation, sought to compulsorily acquire 40% of Famfa’s interest in OPL 216.
In 2005, the administration again sought to acquire a 50% participating interest in Famfa’s equity in OML 127 under government’s back-in rights.
The back-in rights give the Federal Government a right to participate in deep-water OMLs by acquiring five-sixths of the allottee’s interest in the relevant OPL and/or OML.
Famfa took the Federal Government to The Supreme Court and won the case.
Accusation
Alakija has been continuously accused of “shaddy” acquisition of her oil bloc, yet there have not been substantive fact by the accusers, on how she got it except by saying she had “connections” with President Babaginda which led to her being gifted the bloc.
In 2014, when she was interviewed during the Women Inspiration & Enterprise WIE event, Alakija explained how she acquired her bloc after several failed attempt.
“Then the last time I went to see the Minister, he told me that the Government wants Nigerians to be involved in Nigeria’s exploration and production. That it has been the multinationals that have been taking advantage of the oil business in Nigeria.
So I began to ask questions, I began to knock on doors, I began to seek information and in the long run, I applied for an oil bloc. But all through that time, the Ministers have been changed 3 times so each time they are changed, it takes me back to the bottom of the ladder and I will have to start all over again but I still did not give up.”
Unlike the Malabu OPL 245, Famfa OML127 has never been involve in corruption cases, or illegal acquisition which further shows the legality of it acquisition.
