NCDMB, OPTS seal pact on contracting cycle reduction
The Nigerian Content Development and Monitoring Board (NCDMB) and members of the Oil Producers Trade Section (OPTS), the umbrella body of international oil companies (IOCs) and some indigenous operating oil companies have signed a Service Level Agreement (SLA) aimed at shortening the protracted contracting cycle, which unduly delays take-off and completion of projects and leads to increased costs of such projects.
The SLA, signed in Lagos on Wednesday, will commit the 28-member OPTS companies to comply with the provisions of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, which essentially is to submit to the NCDMB documents such as their quarterly job forecasts, Nigerian content plans, bidders lists, Nigerian content evaluation criteria, Nigerian content technical bids, among other relevant information in relation to oil and gas industry contracting and procurement cycles.
The Board also pledged to respond on specific timelines, noting that if it fails to meet the set deadlines, the companies can proceed with their tendering processes after duly informing the Board.
NCDMB Executive Secretary, Simbi Wabote signed on behalf of the Board, while ExxonMobil Nigeria Managing Director, Mr. Paul McGrath signed on behalf of the OPTS. Nigerian Agip Oil Company (NAOC) Managing Director, Mr. Massimo Insulla; Chevron Managing Director, Mr. Jeff Ewing and Total Exploration and Production Nigeria Managing Director, Mr. Nicolas Terraz witnessed the event.
Other industry leaders participated in the event as well as the prior meeting to discuss areas of collaboration with operators and the NCDMB on reducing the duration of industry tendering process. They included Shell Petroleum Development Company (SPDC) Commercial Director, Mr. Martin Foley, who represented the company Managing Director and the Group General Manager of the National Petroleum Investment Management Services (NAPIMS), a subsidiary of the Nigerian National Petroleum Corporation (NNPC), Mr. Roland Ewubare.
The SLA with the OPTS is sequel to the one entered between the Board and the Nigerian Liquefied Natural Gas Company (NLNG) in May 2017, which was the first between a regulator and another entity in the Nigerian oil and gas industry.
Wabote explained at the event that the SLA with the OPTS was in furtherance of the Board’s efforts to meet the target set by the Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu for the industry contracting cycle to be shortened to six months. Through the efforts of the NCDMB, the cycle had been cut significantly to 14 months from 24-36 months.
He stressed that oil and gas industry operations are time sensitive, adding that a shortened contracting cycle would cut the cost of projects considerably.
He noted that the SLA signed with the NLNG had improved the turnaround time of approvals between the two establishments, informing that the Board was working to sign a similar agreement with the Indigenous Petroleum Producers Group (IPPG).
ExxonMobil Managing Director thanked the Executive Secretary for the wonderful initiatives he has introduced since assuming office a year and half ago, noting that OPTS members contributed in the SLA development and they will ensure compliance.
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