By Lukman Abolade, Senior Correspondent, Africa Oil+Gas Report
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has announced the finalisation of the 2023 Nigerian Gas Flare Commercialisation Programme without publishing the list of the successful companies.
In a statement released in Abuja, the NUPRC disclosed that 42 companies/entities were deemed successful in the competition to win and develop 49 flare sites announced during the 2022 Nigerian Gas Flare Commercialisation Programme (NGFCP) auction process. Among these, 38 companies were granted 40 standalone single flare site developments, while four companies received nine sites to be developed as clusters. Additionally, reserve bidder status was granted to some companies in case the preferred bidders failed to meet the stipulated terms and conditions.
But the absence of accompanying list of names of the winners has left several industry stakeholders puzzled, dredging up the usual questions about transparency and accountability in Nigeria’s hydrocarbon sector.
When contacted, Adamu Garba, the NUPRC Head, Public Affairs Unit, cited ‘technicalities’ as reason for the delay in publishing the list along with the commission’s statement of bid round outcome made on September 12, 2023.
“There are still some technicalities that we are trying to fix, when we are done, we’ll make it public, we will make it available then,” Garba said.
But the NUPRC statement itself had indicated that award letters were already being transmitted to the respective successful entities through the appropriate channels.
In furtherance of its mandate in Section 7 (e) and Section 105 (2) of the Petroleum Industry Act (PIA), 2021, the statement said, the commission, in the third quarter of 2022, restructured the NGFCP and re-launched the programme to align with the provisions of the PIA, as well as reflect prevailing economic and operational realities.
“The engagements by the commission were to galvanise and sustain interest in the programme, attract investments and stimulate participation by local and foreign entities,” NUPRC stated.
The Commission noted that in response to the Request for Qualification issued in the fourth quarter of 2022, 300 companies/entities indicated interest in either revalidating their pre-qualification status as existing participants or submitting Statement of Qualification as new participants.
“Following the evaluation of SOQs, a total of 139 applicants were deemed successful and awarded the qualified applicant status. Subsequently, in the first quarter of 2023, the commission issued the Request for Proposal to enable qualified applicants to put together their respective proposals for any of the 49 flare sites on offer.
“88 entities, comprising individual companies and consortiums responded to the RFP and submitted a total of 137 proposals, each containing technical, commercial and financial documentation for one or more of the 49 flare sites for either standalone or cluster development,” the statement read.
NUPRC said the proposals were duly evaluated by the commission and approval secured to announce 38 companies granted 40 standalone single flare site developments, while four companies which also received nine sites to be developed as clusters.
The NUPRC further noted that the preferred bidders would proceed individually to execute a suite of commercial agreements with relevant parties and effect payment of the prescribed award fees to enable the granting of permits to access flare gas by the commission.
However, the absence of a published list of selected companies has left the Nigerian public in the dark regarding the companies that will be sealing these crucial agreements with the NUPRC.
This marks the second consecutive Nigerian hydrocarbon bid round whose outcome would be announced without a list of the winners.
The defunct Department of Petroleum Resources (DPR) also failed to announce the 161 companies selected as winners of interests in the 57 marginal fields on offer in the Nigeria’s second marginal field bid round in 2021 which led to speculations and allegations.
Unlike Nigeria, countries such as Angola, Ghana, and even neighbouring Cameroon routinely publish detailed lists of bid round winners during announcement, providing a clear picture of who will be responsible for developing their hydrocarbon resources. The absence of this crucial information in Nigeria’s announcements has fuelled scepticism and speculation.
In the absence of a published list of winners, stakeholders in the oil and gas sector are now questioning the fairness and integrity of the process. Industry experts argue that without a published list, it becomes challenging to scrutinize the qualifications and capabilities of the winning companies, potentially undermining the program’s success.
In stark contrast to Nigeria’s approach, countries such as Angola, Ghana, and even neighbouring Cameroon consistently publish detailed lists of bid round winners during announcements, providing a clear and transparent picture of who will be responsible for developing their hydrocarbon resources. The absence of this crucial information in Nigeria’s announcements has fuelled scepticism and speculation within the industry.
