Marginal Fields: NUPRC Invites Reserve Bidders after Winners Failed to Pay Within Stipulated Time

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The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) yesterday invited reserve bidders for the 2020 marginal fields programme completed in 2021, after some initial bid winners failed to pay up their signature bonuses within the stipulated time.

A public notice signed by the Commission’s Chief Executive Officer, Mr. Gbenga Komolafe, indicated that a number of the winners of the assets could not pay the fee, prompting the organisation to rework the process.

The commission stated that all offers made to the initial bid winners had lapsed, explaining that by allowing interested reserve bidders to take part in the rest of the process, it will expand the participation of Nigerians.

“Notice is hereby given to the general public, and in particular, all recipients of the letter of notification of potential awardee status in the 2020 marginal field bid round that the 45 calendar days allowed for payment of the requisite signature bonus has since lapsed,” the notice showed.

Last week, the NURPC disclosed that the bid round concluded in 2021 had so far yielded about N174.944 billion, with owners of 30 fields having partially paid and two fields stalled by court cases.

The new commission had further stated that 20 companies which won the bids had partially paid up, from among those who won the 57 oilfields.

In May 2021, the Department of Petroleum Resources (DPR) which has now transmuted into the NURPC with the enactment of the Petroleum Industry Act (PIA), concluded the oilfield bid round, the first successful exercise since 2003 when 24 assets were put on offer.

The process which culminated in the presentation of letters to the bid winners in Abuja by the industry regulator, started in June 2020, with 57 marginal fields spanning land, swamp and offshore put up for lease by the federal government.

Marginal fields are smaller oil blocks typically developed by indigenous companies and have remained unproduced for a period of over 10 years.

Some of the companies which emerged winners at the time, included: Matrix Energy, AA Rano, Andova Plc, Duport Midstream, Genesis Technical, Twin Summit, Bono Energy, Deep Offshore Integrated, Oodua Oil, MRS and Petrogas.

A few others that succeeded in crossing the hurdle and had fully satisfied all conditions were: North Oils and Gas, Pierport, Metropole, Pioneer Global, Shepherd Hill, Akata, NIPCO, Aida, YY Connect, Accord Oil, Pathway Oil, Tempo Oil, Virgin Forest among others.

At the time, it was also a big win for local oil and gas companies in the country, which had a good outing during the ceremony as 100 per cent of the beneficiaries of the exercise were indigenous entities.

Before then, Nigeria last conducted marginal field bid rounds in 2003, with 16 of the fields contributing just two per cent to the national oil and gas reserves.

But in the notice, Komolafe promised that all the reserved bidders would be contacted in a short while to show their interest in paying the signature bonuses.

“Accordingly, in line with the rules and guidelines governing the 2020 marginal field bid round and the notification of potential award letters, all offers made to potential awardees who have failed to pay the signature bonus for their respective equity participation have expired by operation of law.

“And as such, interests have reverted to the bid basket due to effluxion of time for payment of the applicable signature bonus,” he stated.

Furthermore, the commission noted that the equity of the initial bid winners would be pro-rated, indicating that they would only participate to the extent of their payments.

“The commission accepts no responsibility or liability in respect of any action or activity by any such potential awardee, their partners, associates, representatives or privies in further pursuit of any consideration or award under the said MFBR.

“Participating interest for fields where the potential awardees have failed to pay all the required signature bonus will be pro-rated and the portion not paid for has automatically reverted to the bid basket.

“This will be offered to reserve bidders, in line with paragraph 9 (III) of the MFBR guidelines. This is to ensure maximum participation of a wide cross section of Nigerians,” NURPC stated.

In addition, the commission explained that eligible reserve bidders will be contacted shortly to provide proof of funds for payment of the applicable signature bonus, as a basis for the issuance of potential award letters for the equity participation taken back into the bid basket.

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