Nigeria says Omel falls short on pledges

Nigeria says Omel falls short on pledges

Nigeria said ONGC-Mittal Energy Ltd, or Omel, has fallen short on pledges to develop the African nation’s infrastructure that had been made in exchange for rights to explore for oil and gas in two blocks awarded in 2006.

“While they have done some work in other areas, lack of railway infrastructure development is a cause of concern," said Emmanuel Egbogah, presidential advisor on energy matters, Nigeria.

Omel, a venture of state-owned Oil and Natural Gas Corp. Ltd, or ONGC, and Mittal Investments Sarl, a firm owned by the family of steel magnate L.N. Mittal, promised to spend $6 billion (Rs28,000 crore) to build a 180,000-barrel-per-day refinery, a 2,000MW power plant and a railway line connecting eastern and western Nigeria.

Nigeria said in January that it wouldn’t allow Omel to explore any further hydrocarbon blocks unless the commitment was met.

A senior ONGC executive, who did not wish to be identified, said the commitments were linked to certain progress in other areas that the country has not made.