BEVERLY HILLS, CA, November 28, (THEWILL) – The Federal Government on Thursday said it was determined to ensure that proper technical and financial due diligence is done on companies indicating interest in Nigeria’s marginal oil fields as it advised companies interested in the bidding for the 31 marginal fields on sale to bid in consortia, to enable the parties leverage upon each other’s strengths.
Minister of Petroleum Resources, Mrs. Diezanni Allison-Madueke, gave the assurance at a media briefing to signal the kick-off of the second marginalfield licensing round in Abuja.
According to the Minister, ‘’ Today, we are here to flag off the second Marginal Field Licensing Round! Over the next two weeks, the Department of Petroleum Resources will undertake a road show to different parts of the country, about the programme. This will be followed a three and a half month of competitive bidding process in line with the Federal Government’s commitment to openness and transparency in the conduct of business activities in the country. ‘’ In carrying out the exercise, Government is determined to ensure that proper technical and financial due diligence is done on companies indicating interest in these assets. In this regards, Government encourage’s companies where possible to bid in consortia, to enable the parties leverage upon each other’s strengths.‘’ It is therefore now my honour and privilege, to flag off the Second Marginal Field Licensing Round, with 31 fields on offer; 16 of which are located onshore, while the remaining 15 are in the continental shelf.
The names and details of the field will be available on the DPR website, (www.dprnigeria.org.ng), while additional information will be provided by the DPR during their road show.‘’ At this juncture, it is pertinent to state, that this exercise is geared towards opening up the oil and gas sector of the industry, to a wider participation, with a view to creating a robust and virile industry, that will positively impact the lives and living standards of the people of Nigeria. ‘’ She also stated: ‘’ On the 31st of August, 2001, Government announced the take-off of the first marginal field licensing round which resulted in the allocation of twenty-four (24) fields to thirty-one (31) indigenous Nigerian companies in 2003. About a decade thereafter, eight of these fields are producing while the others are in various stages of development.‘’
The successful companies currently contribute about one per cent to the nation’s daily production mix, while recording additional discoveries in excess of 100million barrels to the nation’s reserve base. In their operations, the companies have addressed corporate social responsibility as a critical element, by providing for stakeholder participation as part of their success factors.‘’ In addition, their development strategy is in line with the nation’s Gas Flare Policy and global environmental guidelines on Green House emissions, by ensuring full utilisation of their associated gas. Indeed, one of them has established a modular refinery for diesel production which is the first of its kind in the country.‘’
The level of participation of these companies, in the recent asset divestment of some International Oil Companies (IOCs), is a clear indication of their zeal and appetite for growth. As you may be aware, of the eight assets that have so far been divested, at least four are held by active marginal field operators, who have continued to demonstrate remarkable technical ability in operating significantly larger assets.‘’ The modest achievements of these companies quite evidently justifies Government’s local content initiatives, especially in the upstream sector, thereby spurring another marginal field licensing round that we are here to flag off. ‘’
According to the Minister, ‘’ Early in the life of this Administration, the Nigerian Content Management Act was passed, and has significantly increased the participation of Nigerian companies, in the supply of goods and services to the upstream sector of the industry. Shortly thereafter, a completely revised and revamped version of the Petroleum Industry Bill (PIB) was put before the National Assembly for consideration and passage in to law.
‘’ Whilst we await its passage into law, experts agree that one of the strong points in the Bill, is the favourable provision for small operating companies, some of which are already taking up the assets currently divested. ‘’
