Share this:

Like this:

Like Loading...
" />
Published On: Fri, Jul 13th, 2018

$55m debts: Reps direct firms to show proof of payment or risk suspension

Share This
Tags

By Umar Muhammad Puma and Christiana Ekpan

The House of Representatives Adhoc Committee investigating oil revenue leakages has given an oil firm, New Cross Energy Ltd, till Wednesday next week to provide evidence of royalty payment to the government or risk suspension of its operating license.
The panel which is also probing activities of the Department of Petroleum Resources (DPR), reached the resolution following interaction with representatives of the company who failed to produce any evidence that it has been making efforts at clearing its backlog of debt to the tune of $55million.
Addressing members of the panel on Wednesday, Adesina Shittu, who represented the firm said reconciliation is ongoing with the DPR to deflate the debt, saying that in two weeks or the end of this month, the meeting would have made headway and yielded results.
Asked why the company has not been making remittances, Shittu said the liability was inherited from Shell in 2015 at the point of taking over, but assured that efforts are on to clear the backlog.
A member of the panel, at this juncture called for the suspension of the company’s operating license pending when it’s able to pay its debts, saying that if allowed to keep operating the well under it, the debt could rise to $100million.
The panel therefore asked that the company should go back to produce evidence of payment by Wednesday and report back or face sanction.
Also in a related development, the panel cleared and discharged Continental Oil which hitherto owed the sum of $18million.
The decision to clear the company followed prove of payments presented by its Legal Adviser, Michael Madoghwe to the effect that it has cleared all outstanding liabilities owed DPR.
Madoghwe had told the panel that the issue of payment of royalty and the settlement between parties is very important which led to the splitting of the debt into two.
He said while the first tranche of $8million was paid on May 31st, the outstanding of $10million was paid on June 5, to which he presented receipts.
Chairman of the panel, Rep Jarigbe Agom Jarigbe (PDP, Cross River), noted that with the documents presented, Continental oil has paid all its outstanding commitment to the DPR.
Asked as to why it took the company so long to clear the debt, the MD said the company was able to raise money over time due to cash constraints, forcing it to experience some delay in the payment.
Jarigbe, before discharging the company informed them that the panel would not hesitate to invite them again should any new thing come up before the probe was closed.
The hearing was adjourned to Wednesday, July 18n 2018 for continuation.

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

%d bloggers like this: