The Managing Director and Chief Executive Officer of the Niger Delta
Development Commission, Dr Samuel Ogbuku, has provided more insight into
why International Oil Companies (IOCs) are divesting from onshore operations.
Ogbuku said attacks on pipelines belonging to the IOCs are not the only reason
they are divesting. According to him, part of the reason is the huge sums of
money these multinational oil companies are made to pay as compensation
following court judgments. He noted that these firms believe that, aside from
contending with heavy taxes, they are spending substantial amounts and losing
money through compensation payments to communities that take them to court
for one reason or another.
Ogbuku said: “One thing I know too well today is that IOCs divest from
onshore to offshore and sometimes want to sell their assets to local operators.
We ask ourselves how much the local operators have to fund oil production.
One of the major reasons the IOCs are also leaving is not only because of
pipeline vandalisation. It is also because of judgments that come from the
courts.”
