NNPC, NCDMB, IOCs sign agreement to speed up oil and gas projects

The Nigerian National Petroleum Company Limited (NNPC) and the Nigerian Content Development and Monitoring Board (NCDMB) have signed a Memorandum of Understanding (MoU) with the International Oil Companies (IOCs) to reduce the time it takes to award contracts for oil and gas projects in the country.

This is expected to improve the ease of doing business, reduce costs, and drive efficiency in the industry, which will eventually lead to production growth, increased revenues, and improved profitability for all stakeholders.

The MoU is also in line with the efficiency mandate of the Petroleum Industry Act (PIA), which was recently passed by the National Assembly and signed into law by President Muhammadu Buhari. The PIA provides a legal framework for the reform and development of the oil and gas sector in Nigeria.

The Group CEO of NNPC Ltd., Mr. Mele Kyari, said the signing of the agreement heralds exciting times for the nation’s oil and gas industry and stands as a bold testimony that the company is plunging into a future of hope, productivity, and success. He added that with oil and gas as the bedrock of Nigeria’s economy, there is a need to get the contracting process right so as to get the economy back on track.

The Executive Secretary of NCDMB, Engr. Simbi Wabote, described the MoU as a way forward and a critical step towards enhancing the nation’s crude oil production. He said the MoU will also promote local content and create more opportunities for Nigerian businesses and workers in the industry.

The IOCs, represented by the MDs and Country Chairs of Shell, ExxonMobil, Chevron, TotalEnergies, and ENI, all pledged their commitment and support towards the implementation of the MoU for the benefit of all parties. They expressed their confidence that the MoU will foster a more conducive and competitive environment for the oil and gas sector in Nigeria.

The MoU is part of the Nigerian Upstream Cost Optimisation Programme (NUCOP), which is an initiative of NNPC Ltd. and NCDMB to reduce the cost per barrel of crude oil production in Nigeria. The MoU covers three types of tendering processes: open competitive tender, selective tender, and single sourcing tender. The MoU also provides for dispute resolution mechanisms and periodic reviews of the framework.