The Federal Government, on Wednesday, announced that it issued letters of award to 42 firms for the 2022 Nigerian Gas Flare Commercialisation Programme (NGFCP).
However, rather than coming from the main department in the Ministry of Petroelum Resources which is NGFCP, the announcement came from a statement issued in Abuja by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
Whereas efforts to reach the Head of NGFCP, Engr. Justice Derefaka, the NUPRC statement read in part, “The NUPRC hereby announces the outcome of the bidding exercise and issuance of letters of award to 42 companies/entities deemed successful in the keenly contested bid for 49 flare sites put forward during the 2022 Nigerian Gas Flare Commercialisation Programme auction process.
“38 of the companies/entities have been awarded 40 flare sites for standalone single flare site development, while four are awarded nine sites to be developed as clusters.
“Reserve bidders’ status has also been accorded some companies for the corresponding flare sites in case the preferred bidders fail to meet the terms and conditions stipulated in the RFP (Request for Proposal).”
The NUPRC said award letters were already being transmitted to the respective successful entities through the appropriate channels.
In the third quarter of 2022, the NUPRC restructured the gas flare commercialisation programme and re-launched the it to align with the provisions of the Petroleum Industry Act, as well as reflect the prevailing economic and operational realities in Nigeria.
The commission stated that the significant success recorded in the NGFCP bid process was due to a series of engagements with relevant stakeholders.
It said the stakeholders include domestic investors, international development agencies, oil and gas producers, technology providers and financial institutions.
“The engagements by the commission were to galvanise and sustain interest in the programme, attract investments and stimulate participation by local and foreign entities,” upstream oil sector regulator stated.
It noted that in response to the Request for Qualification issued in the fourth quarter of last year, 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 NUPRC stated.
It said the proposals were duly evaluated by the commission and approval secured to announce 38 companies/entities as successful bidders for 40 sites for standalone single flare site developments and four companies/entities for nine sites to be developed as clusters.
“Some companies were also awarded reserve bidders status for the corresponding flare sites in case the preferred bidders fail to meet the terms and conditions contained in the RFP.
“At this stage, the preferred bidders would individually proceed to execute the suite of commercial agreements with relevant parties and effect payment of the prescribed award fees to enable the grant of permit to access flare gas by the commission,” it stated.
The upstream regulator said KPMG, a global network of professional firms, had been approved to partner with the commission in the implementation of the award, to ensure successful outcome of the gas flare-out commercialisation process.