OMLs 127 & 130 Explained The 1993 PSCs being examined have two PSAs. These are for OML 127 (Agbami- Ekoli) and OML 130 (Akpo & Egina). Agbami consists of OML 127 and OML 128 but different fiscal terms apply to the two OMLs. While there is splitting of profit oil between the government and oil companies for OML 128, government does not get any profit oil from OML 127. Famfa Oil acquired an indigenous sole contract for 100% of OPL 216 in 1993. Famfa Oil’s application for conversion of OPL 216 to an Oil Mining Lease was granted in December 2004 and OPL 216 became OML 127. This OML 127 has been a source of contention between Famfa Oil and the Federal Government. The government has tried to acquire interests in OML 127 through ‘Back-in-Right’ regulations which would have given government a share of profit oil . This was contested by Famfa Oil and the Supreme Court’s judgement in May 2012 adjudged that government is not entitled to any profit oil in OML 127. Considering the fact that the current determination of reserves for Agbami-Ekoli gave OML 127 (62.47%) a higher proportion of reserves than OML 128 (37.53%), the government is really losing out on potential profit oil.
Unlike Agbami which has two OMLs, Akpo & Egina has only one OML (OML 130) . However, OML 130 has two contracts – a PSA and a PSC – where production and reserves are split in half between both contracts. The PSC half is treated as a typical PSC where the government has a share of profit oil. However, the PSA does not feature profit sharing with government. Thus, only the oil companies share profit oil from the PSA half of OML 130.