NCDMB, OPTS sign agreement to shorten oil industry contracting cycle
The Nigerian Content Development and Monitoring Board (NCDMB) and the Oil Producers Trade Section (OPTS), the umbrella body of major international and indigenous operating oil companies on Wednesday in Lagos signed a Service Level Agreement (SLA) aimed at shortening the often protracted industry contracting cycle.
The SLA commits the 28-member OPTS companies to comply with the provisions of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, essentially to submit to the NCDMB documents like their Quarterly Job Forecasts, Nigerian Content Plans, Bidders Lists, Nigerian Content Evaluation Criteria, Nigerian Content Technical Bids among other relevant information in relation to industry contracting and procurement cycles. On the other hand, the Board pledged to respond on specific timelines and committed that should it fail to meet the set deadlines, the companies can proceed with their tendering processes after duly informing the Board.
The Executive Secretary NCDMB, Engr. Simbi Wabote signed on behalf of the Board, while the Managing Director of ExxonMobil Nigeria, Mr. Paul McGrath signed on behalf of the OPTS. The Managing Director of the Nigerian Agip Oil Company (NAOC), Mr. Massimo Insulla; Managing Director of Chevron, Mr. Jeff Ewing and the Managing Director of Total Exploration and Production Nigeria, Mr. Nicolas Terraz witnessed the event.
Others industry leaders that participated in the event as well as a prior meeting to discuss areas of collaboration with operators and the NCDMB on reducing the duration of industry tendering process included the Commercial Director of Shell Petroleum Development Company (SPDC), Mr. Martin Foley, who represented the Managing Director of the company 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.
Speaking at the event, the Executive Secretary explained 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. This initiative is also in line with the Presidential Executive Order 001, which promotes Ease of Doing Business in Nigeria. Initiatives by the NCDMB had helped to cut the cycle significantly to 14 months from 24-36 months which had obtained in the past.
Wabote stressed that operations of the oil and gas industry were 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 turn-around 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).
In his comments, the Managing Director of ExxonMobil thanked the Executive Secretary for the wonderful initiatives he had introduced since assuming office a year and half ago. He stated that the OPTS members contributed in the development of the SLA and they will ensure compliance.