Buckingham’s team will have to fight hard for a Nigerian win

Marion Dakers
WHEN Arsenal last week announced it would play its first pre-season friendly against Nigeria’s national team in Abuja next month, the club won plaudits for bringing investment into the country.

Tony Buckingham, the swashbuckling chief executive of Heritage Oil, must be hoping for a similarly warm reception from investors after his own entry to that region. His firm is in sore need of a success story, having struggled to convince shareholders that work in Kurdistan will eventually come good, after last year’s galling gas find (it had expected to strike oil).

The price of oil might have fallen 13 per cent in dollar terms in the last 12 months, but Heritage’s share price has almost halved. Investors, displeased with the firm’s lacklustre performance, took out their frustrations on Buckingham at last month’s AGM via a 16 per cent protest vote against his re-election.

But having won the bidding war for the OML 30 assets, and survived the AGM with just a bloody nose, Heritage has stepped into the middle of another bust-up. Halfway through an enormous reform of the oil sector, Nigeria’s government is trying to stamp out long-established corruption following January’s deadly protests. Shell estimates that 150,000 barrels of oil per day is stolen in Nigeria, losing the government a fifth of its revenues.

In the last week alone, President Goodluck Jonathan’s clean-up efforts have resulted in sackings at state oil firm (and Heritage’s new partner) NNPC, the arrest of several people accused of siphoning fuel from oil pipelines, and the final stages of a new law to toughen up regulation. Topped off with an $850m takeover, it was a week that underscored the huge potential, and enormous obstacles, linked to Africa’s biggest oil producer. Buckingham is no stranger to risky endeavours, having bought a Libyan oil firm, set up shop in the Congo and battled Uganda over tax claims, not to mention his work as a mercenary in the 1980s. This will be no easy victory, but such a deal could transform his firm into a Premier League explorer.