NCDMB targets six months oil industry contract cycle
The Signing of Service Level Agreements with the NNPC and IOCs has as its grand objective conclusion of oil and gas industry’s tendering to contract award processes within six months, in contrast to years that it has hitherto being.
With the goal of quickly ramping up Nigeria’s flagging crude oil production, ensuring compliance with the provisions of the Nigerian Content Act, and timely approvals of documents, the Nigerian Content Development and Monitoring Board (NCDMB) on Monday in Abuja signed a Memorandum of Understanding (MoU) cum Service Level Agreement (SLA) with the Nigerian National Petroleum Company Ltd (NNPC Ltd) and five international oil-producing companies.
The SLA was conceptualised by the NCDMB and is intended to optimise the contracting cycle in the oil and gas industry and spur the speedy development of new oil and gas projects, contributing to increased oil production and grow the economy.
The agreement was signed by the Executive Secretary of NCDMB, Engr. Simbi Kesiye Wabote, while the new Executive Vice President Upstream of the NNPC Ltd, Mr. Oritsemeyiwa A. Eyesan signed on behalf of the national oil company.
Other top industry officials who signed the agreement include the Managing Director of Shell Petroleum Development Company (SPDC) and Country Chair, of Shell Companies in Nigeria (SCiN) Mr. Osagie Okunbor, and the Chairman and Managing Director of ExxonMobil’s affiliates in Nigeria, Mr. Shane Harris. Others include the Director of Joint Ventures for Chevron Nigeria, Mr. Iwueze Cosmas; the Managing Director, Nigerian Agip Oil Company Ltd, Mr. Fabrizio Bloomfied and the Executive Director, Joint Ventures, Total Exploration and Production Nigeria, Mr. Obi Imemba.
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The Executive Secretary stated that the overall goal is to conclude the oil and gas industry’s tendering to contract award processes within six months, affirming his conviction that the target is realistic with all key parties now on board with the execution of the SLA. He expressed delight that NNPC signed up to the MoU, being the senior partner of the joint ventures and concessionaire of the production sharing contracts (PSC) arrangements that govern the operations of the industry.
Wabote recalled that NCDMB first introduced the 15-day Rule to the industry in 2017, when it promised that it would respond within 15 working days to any formal request for approvals in relation to projects execution. He noted that the rule was later formalised with an SLA in May 2017 with Nigeria LNG Ltd pioneering the process and breaking approval records in respect of the NLNG Train-7 project.
“The industry found the outcome impressive leading to the Independent Petroleum Producers Group (IPPG) signing the SLA in 2018 and Oil Producers Trade Section (OPTS) thereafter,” said Engr. Wabote.
The NCDMb helmsman said that the agency is a business-enabling regulator, stating: “This is attested to by our being recognised and awarded as the most efficient amongst the MDAs in 2022 by the Presidential Enabling Business Environment Council (PEBEC). We are also rated PLATINUM by the Bureau for Public Service Reforms in recognition of the self-imposed reforms of our processes.” The NCDMB boss assured the industry that the SLA would not be an exception, adding that the Board would deliver its side of the deal.
The SLA signed with the Nigeria LNG in 2017 was the first of its kind to be entered between a regulator and another entity in the oil and gas industry. The template was adopted for managing documentation, contracting and expatriate quota applications between the Board and international and local operating companies.
The agreement obligated NLNG to submit to the NCDMB documents like the Quarterly Job Forecast, Nigerian Content Plan, Bidders List, Nigerian Content Evaluation Criteria, Nigerian Content Technical Bid, among others. The Board, on the other hand, had to respond on specific timelines. Should the Board fail to respond in accordance with the provisions of the SLA, the company could proceed with its tendering process after informing the Board in writing or email.
Ayodelé is a Lagos-based journalist and the Content and Editorial Coordinator at Meiza. All around the megacity, I am steering diverse lifestyle magazine audiences with ingenious hacks and insights that spur fast, informed decisions in their busy lives.
