No Directive Yet on Cancellation or Re-award of N48bn Niger Delta Pipeline Surveillance Contract
Contrary to speculation, the Federal Government has not issued any directive regarding the cancellation or re-award of the N48 billion oil pipeline surveillance contract in the Niger Delta. It is understood that the Nigerian National Petroleum Company Limited (NNPCL) is awaiting a presidential directive concerning the contract’s future.
In August of the previous year, reports indicated that the government had awarded the pipeline contract to a security firm owned by Tompolo, a former leader of the Movement for the Emancipation of the Niger Delta. This contract, worth N48 billion per year (N4 billion per month), has generated mixed reactions and led to discussions about potential cancellation or re-award.
Oil sector experts and analysts have advised the government to analyze the Key Performance Indicators of the contract before making a decision to re-award or terminate it. Sources from the Federal Ministry of Petroleum Resources and the NNPCL confirmed that there is currently no directive to cancel or re-award the contract. An official from the ministry stated that the contract is being implemented according to its terms and conditions.
The pipeline surveillance contract involves Tantita Security Services Limited, owned by Tompolo, and covers the protection of oil pipelines across states in the Niger Delta. The NNPCL had defended the contract’s necessity around the time it was awarded, citing the need for private entities and community stakeholders to manage the pipeline network due to oil theft.
Opinion:
This situation highlights the complexity and sensitivity of decisions regarding major contracts, particularly those related to critical national resources like oil. The government’s careful consideration of the contract’s impact and performance indicators is essential to ensure transparency, efficiency, and the best interests of all stakeholders.