Forex shortage, low crude price stall sale of seized rigs, says AMCON
Oritsemeyin, one of the rigs tied at the Marina waterfront, Lagos.
Strong indications emerged that the current shortage of foreign exchange supplies in the country and the dwindling fortunes of the crude oil markets across the globe are taking huge toll on business in Nigeria.
These developments have equalled stalled efforts to sell two oil drilling rigs Oritsemeyin and Onome, seized from Seawolf Oil Services Limited more than two years ago, says Asset Management Corporation of Nigeria AMCON, Federal Government’s agency charged with the responsibility of managing toxic loans, especially in the financial industry.
Recall that Seawolf, owners of the two rigs obtained a N25billion loan facility from First Bank Nigeria Plc, which it could not pay back, leading to the seizure of the two rigs since 2014 and subsequently handed over to the corporation.
Head, Corporate Communications of AMCON, Mr. Jude Nwauzor, who spoke in a telephone interview, disclosed that the corporation has made efforts at selling off the two facilities, which have not yielded the desired results.
He also disclosed that there have been several enquiries from prospective buyers, who indicated their interest in acquiring the rigs, but regretted that such enquiries have not been backed with cash and hence the rigs are still there.
According to him, the inability of these prospective buyers, many who have shown keen interest in acquiring the rigs may not be unconnected with the current foreign exchange shortage in the country, a development that has been worsened by the downturn in the crude oil business across the globe.
“There have been several efforts by the corporation to sell off the two rigs and many prospective buyers have actually shown interest but have not been able to back up such interest with cash”
“This may not be unconnected with the current realities in the foreign exchange market in the country as well as the lull in the crude oil industry across the world, since the rigs are basically used for crude oil drilling”, he said.
He also said that the corporation incurs huge cost in maintaining and running the rigs, as it would cost far more to jumpstart them if they are allowed to go off even for one second.
Investigations showed that one of the rigs, Onome was at one time engaged by Addax but was also dispensed with at the contract, even at the rigs were not engaged thereafter, which negatively affected the financial flow of the company.
For instance, sometime in 2013, about one year before the seizure of the rigs, the company was allegedly owing a whopping N3billion to over 450 members of staff, an indication that the company has not been financially liquid, which partly led to its inability to service the loans.