By Bassey Udo
As part of a deliberate plan by the Federal Government to harness for value gas resources that have always been flared for lack of utilization facilities, prospective bidders under the 2023 Nigerian Oil and Gas Licensing Bid Round are to submit bid proposals on the gas development projects.
The Chief Executive Office of the Nigerian Upstream Petroleum Industry Regulatory Commission, Gbenga Komolafe disclosed this at the Nigerian Gas Flare Commercialisation Programme (NGFCP 2022) Bidders’ Conference in Abuja on Thursday.
The Conference and Investors Forum organsied as part of the 2023 Nigerian Oil and Gas Licensing Bid Round was to intimate all Qualified Applicants, partners, sponsors and technology providers on the structure of the “Request for Proposal (RFP)”.
Komlafe said the Forum was also to help provide further guidance on the upcoming bid exercise and to collate feedback from all participants toward optimizing the RFP phase of the bid process.
During the Statement of Qualification (SOQ) phase of the bid process, the CCE disclosed that out of the 300 applications received from interested applicants, 139 were adjudged qualified/successful following the evaluation exercise conducted in line with the RFQ published criteria.
Komolafe told the qualified applicants that their success at the SOQ stage of the bid process was only the start of the journey, as the real deal was in making a robust and competitive proposal, with demonstrable evidence for capacity to deliver on the flare monetization projects, in line with the terms of the RFP.
Highlighting the strategic importance of the flare monetization projects to the Nigerian economy, Komolafe described it as a very defining moment in the country’s oil and gas industry history when gas is assuming a more significant role in the economy.
“Apart from forestalling the deleterious impacts of gas flaring on the environment, the Programme also ends the wanton wastage of our premium economic resource,” he said.
“In today’s carbon-constrained world, where fossil fuel is becoming less and less popular, in view of issues of climate change, natural gas has assumed a stature of significant importance as the bridging fuel for many oil and gas producing nations,” he added.
For Nigeria, he said gas has been adopted as a transition fuel to drive the industrialization of the nation’s economy in line with the expectations of the Decade of Gas initiatives launched by the government.
Also, the NGFCP initiative, he pointed out, was targeted at creating investment and employment opportunities as well as encouraging increased capital inflow to the Nigerian Oil and Gas sector.
Consequently, he said the value derivable was multifaceted and aligns with the focus areas of the country’s sustainable development goals.
He described the NGFCP 2022 as the first among a series of competitive auctions to ensure that flare gas that would otherwise have been flared would be put on sale by the Commission to interested entities as prospective title holders of the flare gas.
Under the programme, he said prospective bidders under the 2023 oil and gas bid round are expected to submit bid proposals in line with the requirements and terms of the RFP, covering such areas as technical, commercial, financial, and other relevant information on gas development projects they intend to execute.
Such projects, he explained, may include a plan to use the gas as fuel or feedstock or both for products to be disposed of in either the domestic or international markets.
He said all proposals from Bidders would be judged strictly on their merits according to the criteria published in the RFP document uploaded on the NGFCP portal.
During this second phase of the Programme, on the Request for Proposal (RFP), the Commission Chief Executive said Qualified Applicants would be given access to the data room for data prying and leasing, including a suite of Commercial agreements, for the 48 gas flare sites on offer in this NGFCP 2022.
The precise flare sites, volumes, and compositions of gas offered in the Data room would only be accessed after the payment of relevant fees as prescribed in the RFP.
The Data room sessions, he said, would be held virtually to provide flexibility and comfort to all participants., assuring that the Commission would ensure an open, transparent, competitive, and non-discriminatory bidding process in line with the provisions of Section 74 of the Petroleum Industry Act (PIA) 2021
On the choice of technology, product output, or destination, Komolafe said the Commission was favourably disposed to bidders who may consider clustering, saying would show greater mop up of the flare gas by a proposal.
He reiterated the Commission’s commitment to continue to provide a predictable and enabling regulatory environment to Qualified Applicants in line with its technical and commercial statutory mandates towards optimizing the commercialisation of the flare gas resources.
The Forum provided an opportunity for prospective bidders to seek clarification on issues relating to the RFP.
