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Komolafe: 33 firms lost marginal field awards over non-payment of signature bonuses

Komolafe: 33 firms lost marginal field awards over non-payment of signature bonuses
January 28
11:52 2022

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) says 33 companies failed to pay the required signature bonuses for the 2020 marginal field bid round within the 45-day window.

This implies that the companies’ awards have been revoked and will be granted to reserved bidders.

Gbenga Komolafe, NUPRC’s chief executive officer, said this on Thursday in Abuja during a meeting with marginal field awardees and leaseholders.

Marginal fields are smaller oil blocks developed by indigenous companies, and they have not been exploited in at least the last ten years.

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In May 2021, the Department of Petroleum Resources (DPR) — now NUPRC — had completed the first successful bid programme after 18 years. 

Over 600 companies had applied to be pre-qualified for the bid rounds of 57 marginal fields, which began on June 1, 2020.

Speaking at the meeting, Komolafe said efforts were being made to close the bid round and that the commission would support successful awardees who had paid the required signature bonuses.

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“57 fields were identified for the 2020 bid round exercise, and a total of 665 entities expressed interest. After extensive evaluation processes as laid down in the guidelines, 161 entities emerged as potential awardees,” he said.

“Signature bonuses for 119 awards were fully paid, nine awards were partly paid for and 33 awards were not paid for. This has resulted in various challenges inhibiting the close-out of the exercise.

“The marginal field guidelines provided for 45 days for the payment of signature bonus which has since elapsed, and we have issued a public notice to that effect as well as notified the relevant potential awardees.

“It is pertinent to inform you that concerted efforts are being made to ensure that the 2020 MFBR exercise is completed within the shortest possible time.”

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He said relevant marginal field leaseholders had also been invited to the forum so that they could understand their roles and responsibilities as it affects the farm-out of the fields, which he said included facilitating the achievement of first oil collaboratively.

The NUPRC boss further disclosed that the federal government had so far garnered about N174 billion from the signature bonuses paid by the companies for the fields.

He said the NUPRC management, on the assumption of duty, set up a committee to look into issues surrounding the bid round and come up with strategies to resolve them.

“And some of these issues include the formation of SPVs, equity participation, and part payments,” he said.

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According to him, the committee has had engagements with some awardees and would continue such meetings with another set of awardees slated for next week in Lagos.

The commission, he said, through the Alternative Dispute Resolution Centre (ADRC) also offered an opportunity for co-awardees of marginal fields to resolve issues speedily and amicably.

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