NUPRC Chooses 42 for Gas Flare Commercialisation Bids
By Adedapo Adesanya
Twenty-two oil and gas companies have been selected as successful bidders for the gas flare commercialisation programme of the Nigerian Upstream Petroleum Regulatory Commission ((NUPRC).
The 2022 Nigerian Gas Flare Commercialization Programme (NGFCP) auction process was for 49 Flare Sites put forward by the agency under the erstwhile administration of Mr Muhammadu Buhari.
The immediate past government in December 2016 launched NGFCP to involve third-party investors or off-takers in harnessing gas released as a by-product of oil production, a crucial part of the seven big wins of the administration for the oil and gas sector.
Launched by then Minister of State for Petroleum Resources, Mr Ibe Kachukwu, NGFCP was intended to offer gas-for-sale by the government through a transparent and competitive bidding process, with a structure devised to provide project bankability for the flare gas buyers.
The programme was one of the government’s initiatives to drive the attainment of zero routine gas flaring by 2035 and net zero emissions by 2060 in the country.
The Buhari government disclosed that 226 companies had submitted bids before the project was suspended at the onset of the COVID-19 pandemic in 2020.
The programme was first superintended by the defunct Department of Petroleum Resources (DPR), which announced the identification of the 49 flare sites in February 2020.
However, with the Petroleum Industry Act (PIA) coming into existence in August 2021, ending the existence of DPR and replacing it with the current NUPRC, the commission last October announced the relaunch of the gas commercialisation programme and opened bids.
NUPRC, while announcing the outcome of the bidding exercise, said issuance of letters of award to the 42 companies/entities deemed successful in the process was ongoing.
It said 38 of the companies had been awarded 40 Flare Sites for standalone single flare site development, while four were awarded nine sites to be developed as clusters.
Reserve bidders’ status has also been accorded to some companies for the corresponding flare sites in case the preferred bidders fail to meet the terms and conditions stipulated in the Request for Proposal (RFP).
According to NUPRC, award letters are already being transmitted to the respective successful entities through the appropriate channels.
The successful 42 winners emerged out of the 300 companies/entities that indicated interest in either revalidating their prequalification status as existing participants or submitting Statement of Qualification (SOQ) as new participants.