Nigerian court to decide S.Korea oil case

A Nigerian court will decide next month whether President Umaru Yar’Adua legally revoked two oil exploration licences from Korea National Oil Corp (KNOC), it said yesterday.
Yar’Adua in January withdrew KNOC’s rights to two oil blocks awarded by the previous administration in 2005, saying the Korean firm failed fully to pay the investment pledged, Reuters reports.
KNOC said it had met its obligations and asked a federal court in Abuja to reinstate its oil licences.
Judge Abdullahi Mustapha said a ruling would be made on Aug, after arguments from both parties were heard.
The Korean oil firm had argued that under Nigerian law only the minister of petroleum has the power to revoke the contracts.
But government lawyers countered that the president has the power to revoke the oil licences since he has authority over the minister of petroleum, and urged the court to dismiss the case.
Former President Olusegun Obasanjo’s administration in 2005 awarded a South Korean consortium, led by KNOC, rights to two key oil blocks in return for a pledge of major infrastructure investment in Africa’s top oil producer.
Preliminary estimates suggest that the revoked oil fields could hold as much as 1 billion barrels of hydrocarbons.
The consortium, which includes Daewoo Shipbuilding and Korea Electric Power Corp, filed the suit to restore the licences in March.