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  • NUPRC to penalize firms for failingto deliver crude for domestic refining

    NUPRC to penalize firms for failingto deliver crude for domestic refining

    As local companies have sent their notification to start refining crude oil, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) at the weekend said any company that fails to supply them with the agreed crude oil will be compelled to pay 50% of the amount per barrel not delivered.

    The commission’s Head, Public Affairs and Corporate Communications, Mrs. Olaide Shonola broke the news in a press statement issued at Abuja.

     “A company that fails to comply with the DCSO would be made to pay a penalty of 50% of the Fiscal Price per barrel not delivered,” she said.

    According to her, NUPRC has restated its determination to apply all required penalties for default and has emphasised that a company that fails to respond to the Request for Quotation (RFQ) within the specified period is liable to pay an administrative fine of USD10,000, while a company that has not complied with its DCSO, where the willing buyer(s) exist will not be granted an export permit.”

    Read Also: Oil theft: NUPRC introduces advanced cargo declaration

    The statement noted that more local refineries have notified the commission on their readiness to begin production soon in the country.

    Shonola revealed that NUPRC is taking all necessary steps within the prescriptions of the Petroleum Industry Act (2021 ) to ensure an adequate and consistent supply of feedstock to operators.

    It cautioned that there would be consequences for sabotaging the process.

    The statement noted that preemptive steps are being taken because it would send wrong and unbecoming signals to the international business community if operators of domestic refineries in one of the world’s largest crude oil producing countries start importing feedstock for their production.

    According to NUPRC, it was in contemplation of this that Section 109 of the Petroleum Industry Act (PIA) 2021 introduced the Domestic Crude Supply Obligation (DCSO) to Nigeria’s oil industry in a bid to ensure that domestic refineries are not starved of crude oil supply for their operation.

  • Oil theft: NUPRC introduces advanced cargo declaration

    Oil theft: NUPRC introduces advanced cargo declaration

    To curb the incessant oil theft, the Nigerian Upstream Regulatory Commission (NUPRC) has introduced an Advanced Cargo Declaration regime in upstream petroleum operations.

    The commission also announced plans to reactivate shut-in wells as part of initiatives to increase oil and gas production.

    The Commission’s Chief Executive Officer, Gbenga Komolafe, broke the news at the Annual International Strategic Conference, organised by the Association of Energy Correspondents of Nigeria (NAEC), in Lagos.

    Represented by Abel Nsa, Head of the National Oil and Gas Excellence Centre (NOGEC), NUPRC, Komolafe said the initiative is aimed at ensuring that crude oil and gas  exports have a unique identifier that confirms documentation of exports.

    ‘‘This implies that any cargo without the unique identifier becomes tagged as illegitimate. This, by no small measure, enhances transparency in our export operations,” he stated.

    He said NUPRC had deployed key resources to the Special Investigative Unit of the Commission to forestall sharp practices by operators.

    ‘‘Over the next few months, we are positive that we shall record a marked increase in our national oil and gas production volumes.

    “Quick-win strategies such as our aggressive drive to reactivate shut-in and declining wells will boost production prior to the onset of more long-term initiatives like operations from the new Marginal Field awardees.

    “Also, the Commission is working alongside security operatives to bring a halt to the menace of crude oil theft, which has over the years contributed to a huge loss of production,” he said.

    Read Also: NUPRC moves to amend host community regulation implementation

    Komolafe added that the agency had begun the implementation of the Drill or Drop Provision with a review of assets which had been undeveloped by operators.

    Such assets, he said, would be placed in a basket and then offered to willing and qualified investors with the capacity to explore, develop and produce the block(s) or field(s) in a timely, efficient, safe, and environmentally friendly manner.

    He stated that the ongoing mini bid round for seven Deep Offshore Petroleum Prospecting Licences (PPLs) would boost the nation’s reserves as well as bring about anticipated benefits to the nation and other stakeholders.

    On reduction in unit cost per barrel and revenue, he explained that the Commission is committed to ensuring a significant reduction in the cost of doing business in the upstream petroleum industry.

    ‘‘Following an in-depth comparative analysis between the Unit Operating Cost (UOC) in Nigeria and those obtainable in other climes

    “We have commenced the development of cost studies and benchmarks to ensure an improvement in the cost efficiency of our upstream petroleum operations, in accordance with Section 8 of the Petroleum Industry Act 2021.

    The NUPRC has also begun a review of all Crude Handling Agreements (CHA) with a view to entrenching openness and competitiveness, thereby reducing the cost of production while increasing government revenue from the sector. It is noteworthy that in the year 2022, using the strategies listed above, the Commission outperformed its revenue collection target by 18.3 per cent’’, he explained

    Komolafe maintained that the Commission had stepped up efforts toward transparency in the sector and that transparency in hydrocarbon accounting was essential in ensuring maximum value derivation by the government and stakeholders. Transparency is essential to ensuring security of investments made by our financial partners, he added.

  • NUPRC moves to amend host community regulation implementation

    NUPRC moves to amend host community regulation implementation

    The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) yesterday commenced the consultation for the amendment of the host community regulation implementation regime.

    The Commission Chief Executive Officer, Gbenga Komolafe disclosed this in Abuja during the 4th Phase Consultation with stakeholders on regulations development as mandated by Section 216 of the Petroleum Industry Act 2021 (PIA).

    He introduced for consultation the Draft Amendment to the Nigerian Upstream Petroleum Host Communities Development Regulations 2022

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    According to him, the essence of the amendment was to ease the administrative process and provide  regulatory clarity to the challenges the implementation of the regime has thrown up in the last one year since the initial regulation was established.

    Read Also: Tinubu celebrates NUPRC boss Komolafe at 60

    The Executive Commissioner, Economic Regulation and Strategic Planning, Dr. Kelechi Ofeogbu, who represented him, said: “This draft amendment regulation seeks to introduce certain amendments to the existing regulation on the implementation of the host community regime to further ease the administrative process and provide regulatory clarity to the challenges that the implementation of the regime has thrown up in the last one year since the initial regulation was established.”

    Other three regulations that the commission tabled for amendment were :  Draft Upstream Commercial Operations Regulations 2023;

    Draft Nigerian Upstream Petroleum (Administrative Harmonization) Regulations 2023; The Draft Upstream Petroleum Code of Conduct & Compliance Regulations 2023; 

    Draft Petroleum Assignment of Interest Regulations 2023 Komolafe, however noted that this  phase of public hearings on the making of regulations for the upstream is divided into two segments. 

    He said the first segment would run from  9th October to Friday 13 October. 
    The Second segment, he said, would start from the 8 to 10 November, 2023.