President Bola Tinubu has made some big changes for how contracts get approved for the Nigerian National Petroleum Company (NNPC) Limited.Â
Now, contracts worth at least $10 million (or the same value in Naira) can get the green light.
He wants things to move faster, saying that each stage of approving a contract should take no more than 15 days.
This change also means contracts under the production sharing contract (PSC) or Joint Operating Agreement (JOA) can now last five years instead of three, with a chance for a two-year extension.
Tinubu thinks Nigeria’s oil and gas sector takes too long to make deals compared to other countries, making it hard to attract investors.
He’s determined to make Nigeria a top spot for investing in Africa’s petroleum industry. These new rules are all about making it easier to do business and reforming how contracts work in Nigeria’s oil industry.
The Ministry of Finance Incorporated (MOFI) and the Ministry of Petroleum Incorporated (MOPI) will keep an eye on contract approval limits, adjusting them to match inflation each year.
Meanwhile, NNPC and Nigerian Upstream Investment Management Services Limited (NUIMS) will team up with the Nigerian Content Development Monitoring Board (NCDMB) and others to simplify the contract approval process. They’ll aim to approve contracts faster and with less hassle.
If NNPC and NUIMS don’t respond to a contract application within the set time, it’s automatically approved. NCDMB has to review Nigerian Content Plans within 10 days or they’re considered approved.
The same goes for applications for expatriate workers in the petroleum industry—they have to be dealt with in 10 working days if all the paperwork is in order.
Basically, Tinubu wants things to move quicker in the oil and gas sector. He’s put new rules in place to speed up contract approvals and make Nigeria a more attractive place for investors.
