Mispricing China (IV)

By
Sampson Iroabuchi Onwuka

The point here is that China is only a market term for cheaper alternatives to US and Europe, but just because it is called cheaper and China does not mean that it is now cheap in the way we want people to understand. I must repeat that China doing business through large companies and in dollars term are not cheap at all and emphasis on this cheap alternative should be dropped in Nigeria and in Africa. In dollars terms or approximate equivalent, these companies are no different from European and America oil. The same critical measure should be applied to these people especially their new found position with a Nigerian oil company by name Qua Iboe.

Many Nigerians are now very concerned about the near developments of using public businesses for private ends. In fact, the name trend is to transfer much of what public trust from the hands of the government to some people levied interest at the apex oil group and business. There is no need to dwell on this fact, since many Nigerian companies originating from the West and by many Western Nigerians are making headways in Crude oil. The point is not that Nigerians should privateer these NNPC business or place high derivative over the crude oil market like Rilwanu Lukman did - who I think should be prosecuted very acutely - rather Nigerians interested in making ends meet in terms of oil and business related to oil, should pursue participation of these businesses through direct ‘direct’ acquisition of some companies in many parts of the world, especially China

Finally in terms of the impending Auction…

However, there is need to be warned about the recent deals by Nigerian Government and Presidential adviser on Nigerian Petroleum, since lessons are still fresh about the incidents of 2005, 2006, 2007, block and rig zone licensing, which were subject to reckless Asian lobby and wild manipulations. The result was that highly lucrative Nigerian oil zones were cheaply and almost derisively licensed out to these Asians, among them China. China has the attention of the world, but needs be said that honesty which we think is their keeping is not always theirs. Well travelled Nigerians to Asia and those living in US will admit that that Chinese may be better other than Asian lot, but they are can be quite corrupt if they choose to.

From 2004 through 2007, there was at least 77 licenses released by Nigeria for companies interested in drilling oil in Nigeria and only 33 of these licenses are retained given the ‘empty’ goose promises made by these companies to Nigeria. The right to question certain assumption in the deals is not beyond many Nigerians. The temptation to manage budget deficit from auction is very serious since much of the lobby is involved.