Peter Uzoho
Shell Nigeria Exploration and Production Company Ltd (SNEPCo) yesterday took a major step towards empowering Nigerian oil and gas contractors and furrher growing local content with the launch of a $3-billion Contract Finance Facility in partnership with nine major Nigerian banks.
A statement signed by Shell’s Country Communications Manager, Gladys Afam-Anadu, said the facility was designed to provide credit support for local contractors executing projects for SNEPCo operations and will be available in both Naira and US Dollars.
The participating banks are First Bank, Guaranty Trust Bank, Zenith Bank, Access Bank, United Bank for Africa, Stanbic IBTC, Standard Chartered Bank, First City Monument Bank and Fidelity Bank.
Speaking at the signing of the Memorandum of Understanding (MoU) n Lagos, the SNEPCo Managing Director, Ronald Adams said, “the initiative reflects the spirit of the Nigerian Oil and Gas Industry Content Development Act, which is aimed at in-country value retention.
“Our partner banks offer capital and discipline. SNEPCo brings contracts and domiciliation of payments that de-risk lending. On their part, the contractors provide performance. Each is accountable to others, and the mutual accountability gives the arrangement its strength.”
Also speaking at the signing ceremony, the Vice President, Finance, Shell Nigeria, C. J. Akwaeze, said the scheme reflects Shell’s commitment to the growth of oil and gas operations in Nigeria.
In his remarks, Chairman of the Petroleum Technology Association of Nigeria (PETAN) and Chief Executive Officer of Geoplex, Wole Ogunsanya, represented by the association’s Publicity Secretary, Dr Joan Faluyi, lauded the scheme as a “gateway to unlocking contractor financing issues which will also drive efficiency in contract execution.”
Representatives of the banks commended SNEPCo for the opportunity to partner on an initiative aimed at empowering contractors and assured the company of their continued support and cooperation.
Nigerian companies have continued to play key roles in supporting SNEPCo’s operation and project execution.
Early this year, 43 wholly Nigerian companies took part in the turnaround maintenance exercise at the Bonga Floating Production and Offloading (FPSO) vessel out of the total of 53 companies involved.
The Contract Finance Facility is expected to further boost the capacity of Nigerian companies to deliver even more value in the operations of Nigeria’s premier deepwater producer.