Ajapa Marginal Field: 2007 MoU with Britannia-U, falls short of proportionality in 2026 – Stakeholders

Stakeholders in Ogulagha Kingdom in Burutu Local Government Area of Delta State, say the agreement signed between Britannia-U Nigeria Limited and the Ogulagha Kingdom in 2007, regarding operation of Ajapa Marginal Field, may not meet transparency and proportionality expectations in 2026.

The stakeholders, who argued that the 2007 MoU, was not tied to production, “whether output increases or oil prices rise”, asserted that Ogulagha Kingdom is not merely a host community, but a registered shareholder in the Ajapa Marginal Field structure.

Briefing newsmen in Warri, Delta State, Thursday March 19, on behalf of stakeholders of the Ogulagha Kingdom, Mr. Jude Iyalagha, averred that there was no revenue sharing formula, no indexed development fund and no escalation clause in the MoU.

He added: “Over time, inflation reduces value, while oil revenue may grow. That is how inequality expands quietly, through static agreements in a dynamic industry.”

Mr. Jude Iyalagha, emphasized: “Ogulagha Kingdom is not merely a host community, but also a registered shareholder in the Ajapa Marginal Field structure, documented with Nigeria’s Corporate Affairs Commission. Community representatives claim they have not consistently received audited accounts, production visibility, or clarity on dividend declarations.

“The introduction of the Petroleum Industry Act, has reshaped host community structures in Nigeria, establishing more defined trust mechanisms and governance expectations. Agreements signed before this reform, may now appear outdated when measured against current standards.

“The agreement provided: N150,000 per community per year for drugs. With seven communities, this totalled N1.05 million annually. Scholarships for two secondary students per community at N30,000 each, and one tertiary student at N75,000. Across the kingdom, this amounted to N945,000 yearly. Two trainees per community at the Petroleum Training Institute in Effurun, plus a N50,000 allowance each. A 20 percent salary incentive for science teachers. N10,000 per sitting for kingdom committee meetings. In 2007, these figures were considered workable.

“In 2026 economic terms, their value has been sharply reduced by inflation. What could once stock a modest health center today barely covers basic medication procurement. The commitments were fixed sums. They were not indexed to oil prices, production volume, or inflation. That structural detail would later prove significant.

“Marginal fields in the Niger Delta commonly produce between 3,000 and 10,000 barrels per day, depending on development phase. Using a conservative estimate of 5,000 barrels per day: 5,000 barrels x 365 days equals 1,825,000 barrels annually. At an average price of 70 US dollars per barrel, annual gross revenue would reach about 127.75 million dollars. At roughly N1,400 per dollar, that converts to approximately N178 billion per year in gross revenue. Even after deducting operating costs, royalties, and taxes, the revenue scale remains in tens of billions of naira annually.

“For families living near oil installations and flare stacks, development is expected to mean more than small scholarship slots.

“Community leaders argue it should translate into modern clinics, vocational hubs, shoreline protection, potable water systems, and structured employment pipelines.

“The agreement includes environmental cleanup obligations, yet it does not establish a pre funded restoration pool. For Ogulagha Kingdom, the concern is not simply what was promised, but whether the framework was strong enough to secure long term protection.

“If shareholding exists in formal filings, but governance participation does not occur in practice, the issue shifts from corporate social responsibility to corporate accountability.

“Without access to; Production data, lifting schedules, cost recovery details, royalty payments, Dividend records, A shareholder cannot independently verify profitability or entitlement.

“For Ogulagha Kingdom, the grievance is deeply emotional as well as financial. Ogulagha Kingdom hosts the asset. Ogulagha Kingdom bears environmental exposure. Ogulagha Kingdom claims equity. Yet leaders say the kingdom lacks voice in corporate decision making.

“To hold shares on paper, but not visibility in practice, creates a sense of exclusion that goes beyond money.”

As at the time of this report, the management of Britannia-U Nigeria Limited, could not be reached for their official response.

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