April 16, 2024

NNPC, NCDMB, IOCs sign agreement to shorten oil, gas industry contracting cycle, ease of doing business, reduce cost 

Oredola Adeola

 

The Nigerian National Petroleum Company (NNPC) Limited, Nigerian Content Development and Monitoring Board (NCDMB), and international oil companies operating in Nigeria have signed a Service Level Agreement (SLA) and Contracting Cycle Optimisation MOU aimed at shortening the contracting cycle in the Nigerian oil and gas industry.
The agreement was signed on Monday at the NNPCL headquarters in Abuja, with Chief Executives from Chevron, ExxonMobil, Total, Shell, and Eni in attendance. 
Engr. Simbi Wabote, Executive Secretary NCDMB, in his remark stated that the signing of the agreement is a significant step towards improving the Ease of Doing Business in the Nigerian oil and gas industry. 
He said,” The agreement will help to reduce the time it takes to complete contracts, which will ultimately lead to increased efficiency and productivity in the industry.
Mele Kyari, the NNPCL Group Chief Executive Officer (GCEO) was represented by Mrs. Meyiwa Eyesan, Executive Vice President Upstream.

According to the NNPC GCE Kyari, signing 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 the future of hope, productivity and success.

 

He added that with oil and gas as the bedrock of Nigeria’s economy, there is the need to get the contracting process in the industry right so as to get the economy back on track.

In their various remarks, the IOCs, represented by the MDs/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.

 

The NNPC said that the framework is in line with the Nigerian Upstream Cost Optimization Program (NUCOP) and in consonance with President Bola Tinubu’s directive for NNPC Ltd. and NCDMB to engage the industry with the objective of improving the performance of the petroleum industry.

 

 

EnergyDay gathered that the key benefits of the framework in the MoU include a reduction of the contracting cycle for open competitive tender, selective tender, and single sourcing tender to 180, 178, and 128 working days respectively compared with the current best effort performance of 327, 333, and 185 working days respectively.

 

The development is also in line with the key mandates of NNPC Ltd under the PIA’s Article 53 (7) which empowers it to operate as a commercial entity in a profitable and efficient manner, as the National Energy Company.

 

The mandate for efficiency requires that NNPC Ltd. is committed to working with its partners in ensuring key processes, procedures, and timelines that drive major business activities such as contracting, are structured in a manner that engenders efficiency and drives profitability.