Aiteo bucking the trend

Aiteo bucking the trend

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THE recent five-year N2.7bn ($8.5 million) sponsorship of the Nigerian Football Federation (NFF) by Aiteo Group, a locally-owned oil company, has raised its standing in the industry with commentators saying that its performance provides hope for indigenisation of the oil and mining sectors in Africa. The company’s growth is one reason for the Nigerian government to be happy, given it has been encouraging local entrepreneurs to invest in the oil sector.

Over the years a total of $10bn has been spent by successive governments in Nigeria to buy back oilfields as part of the indigenisation of the sector, although this not at the stage that the government would like it.

Nevertheless, in Zimbabwe where the government grabbed white-owned farms, they are saying that in the case of Nigeria indigenisation is not ‘a dirty word’.  The Zimbabwean newspaper noted recently, ‘Zimbabwe, once among the best economies in Africa, went on a grab-all of assets, with dire result. Likewise, if Nigeria had seized foreign wells, it could have seen wholesale disinvestment and a collapse of the naira.

‘Instead, a system was nurtured that allowed locals to raise finance against future revenues, buying not just oil claims but, in Aiteo’s case, the key pipeline that carries crude from mine to port.’

The founder and CEO of Aiteo, Benedict Peters, borrowed heavily from local banks to buy a lease from Shell in the Niger Delta lease. Peters, who has nearly 30 years of experience in the oil and gas industry, where he has held a number of executive and senior management positions, told journalists recently, ‘We have shown by our story that indigenous oil companies are competent.’

The NFF sponsorship deal will guarantee salaries of coaches and other backroom members of staff supporting Nigeria’s men’s and women’s national football teams. Constant bickering over non-payment of salaries of staff and bonuses to players has usually disrupted Nigeria’s performances at global tournaments.  It is expected that the multi-billion sponsorship, which has the option of a year’s extension, will aid the Super Eagles in their bid to qualify for the 2018 World Cup in Russia and the 2019 Africa Cup of Nations (AFCON) in Cameroon.

‘As Nigerian companies grow, I believe the benefits of that growth should be spread as widely as possible,’ Peters said. ‘Aiteo Group is as passionate about leadership as Nigerians are about football, so we are proud to be working together with the NFF and its coaching staff to reach a shared goal of a more prosperous Nigeria. Aiteo Group is proud to sign this multi-million dollar partnership, which will help to support the Super Eagles to success in the 2018 World Cup, the 2019 AFCON and beyond.’

Aiteo Group is one of Africa’s fastest-growing energy companies, operating through subsidiaries of which Aiteo Eastern E&P Co. Ltd is the main subsidiary. It is clearly bucking the indigenisation trend in Africa whereby locally-owned companies usually fail to make the grade.

‘There may be a lesson here for Africa,’ the Zimbabwean newspaper said. ‘And Zimbabweans might wish Mr Peters would bring his ideas to Harare.’

The company has over the years been making a lot of financial contributions to the communities in the Niger Delta where it operates. These contributions are made in three ways: donations to churches and registered charities; scholarships for higher education, especially in engineering; and empowerment programmes to enable local people to be more responsible citizens.

The integrated energy group says it has a clear vision for the future and the experience and assets necessary to provide oil and gas on a regional and global scale. It discovers, produces, stores and delivers energy resources to marketplaces worldwide. It is currently ‘responsibly’ developing develop energy resources in some of the world’s most significant basins, including the huge potential of the Niger Delta basin in West Africa’s offshore fields, and of the Benue Trough.

Last week, Aiteo took steps to raise funds from global capital markets in order to reinforce its growth and diversification in Nigeria and across Africa following the appointment Ratko M. Knezevic from Montenegro as Group Advisor on Business and Capital Development. The appointment, according to Peters, ‘is a testament to Aiteo’s commitment to stable, experienced leadership.’

 

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