The Chairman of Heirs Holdings, Mr. Tony Elumelu, accused former President Muhammadu Buhari and his late chief of staff, Abba Kyari, of obstructing his initial attempt to acquire an oil field in 2017.
Elumelu, who is also the Chairman of the United Bank for Africa Plc, made these remarks in an interview with The Financial Times.
He stated that Heirs Holdings has been seeking to acquire an oilfield since 2017 and has raised $2.5 billion for the purchase.
He expressed surprise at being informed that Nigeria could not allow such a strategic asset to be owned by a private operator, especially considering that the purchase would have been from a foreign company.
However, Elumelu’s decision to buy a 45 percent stake in an oilfield three years ago surprised many. International oil companies such as Shell, Total, and Eni were selling off their shallow water assets in Nigeria, with local companies taking charge.
In 2021, his Heirs Holdings acquired OML 17, an onshore oilfield as part of a deal that included $1.1 billion in financing from a consortium of global and regional banks and investors.
Shell, Total, and Eni each had sold stakes in the OML 17 field, which has a production capacity of 27,000 barrels of oil equivalent per day and estimated reserves of 1.2 billion barrels of oil equivalent, Heirs said.
When asked if he felt like getting in at the end of the party by buying an oil asset in the age of energy transition and environmental, social, and governance investing, Elumelu said: “We wanted to become a Fortune 500 company and we estimated what we needed. It’s not naira, it’s huge dollars.”
He added that energy security is crucial for a country that doesn’t produce enough electricity for its roughly 200 million citizens.
He said he discovered first-hand why international oil companies were partly divesting from onshore assets after criminal gangs began stealing crude from his pipelines.
In 2022, when things got to a point where his company had to shut down production, Elumelu vented his frustration on social media, tweeting: “How can we be losing over 95 percent of oil production to thieves?”
Today, though, business is looking up. Elumelu, according to FT, showed the status updates he received on his phone from the field: 42,000 barrels of crude pumped out daily. Theft still takes away about 18 percent of production, he said.
When asked who was behind oil theft in the country, he said: “This is oil theft, we’re not talking about stealing a bottle of Coke you can put in your pocket. The government should know; they should tell us. Look at America — Donald Trump was shot at and quickly they knew the background of who shot him. Our security agencies should tell us who is stealing our oil. You bring vessels to our territorial waters and we don’t know?”
His Removal As UBA Boss
Elumelu led UBA for another five years until a central bank decree led to the ousting of long-serving bank executives.
“2010 was a pivotal year for me,” he said while speaking about his ouster as UBA boss.
“The central bank ruling was a complete surprise. Was it fair? Look, as someone who believes in governance, it probably makes sense, but it was a shock. But it was also liberating, catalysing,” he added.
By the end of that year, he had formed Heirs Holdings, the investment engine that launched the second act of his career and turned him from a banker to a multi-sector magnate.
“I don’t live for myself or my family alone, I know people look up to me,” he said of his fame outside of the boardroom.
“I try to make sure I don’t disappoint people. Young Africans need role models, they want people they can look up to,” he added.
His Philosophy of ‘Africapitalism’’
Elumelu’s philosophy of “Africapitalism” is based on the premise that the continent cannot grow solely through the government, and that the private sector should actively invest even when — especially when — socio-economic conditions are tough.
“We can sit here today and the easiest part of the conversation would be to talk about all the things that have gone wrong, all the things that people have failed to do.
“But therein lies the philosophy of Africapitalism. For far too long, we have blamed foreign powers. We have blamed our leaders. But what are we as the private sector doing to make things better?
‘’It’s a call on the private sector to stand up and show the way. Let us show the way through what is in our power. We have the power to make investment decisions.”
With investments in 20 African countries and thousands of employees, he believes he is playing his part. And through grants from his Tony Elumelu Foundation, he says he is “democratising luck” for young entrepreneurs.
“I have my frustrations across the continent but I also have my wins. . . what I’m saying is we need to do something to have a better society.”
As a member of President Bola Tinubu’s presidential economic advisory committee, he is one of a handful of business leaders close to the administration. The reforms that Tinubu — whose “courage” Elumelu likes — has embarked on are necessary for long-term growth, Elumelu said, but he wonders if the sequencing of removing costly but popular fuel subsidies and a sharp devaluation of the naira currency could have been implemented better to first provide a social safety net for the most vulnerable in society.
“I support it, totally,” he says of skilled young Nigerians emigrating. “I don’t have a problem with people saying ‘I’m going to Canada, UK or US.’
“Joblessness is the betrayal of a generation. You’ve gone to school and come back with your dreams and aspirations and you don’t have the opportunity. . . For people who decide to find solutions elsewhere, no one should stop them. But for those who decide to stay, they should try to create an impact and build a legacy.”
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