Barely a month after the unveiling of Nigerian National Petroleum Company Ltd (NNPC Ltd) by President Muhammadu Buhari, the company on Saturday announced the execution of fully termed agreements for the renegotiated Production Sharing Contracts (PSCs), a development that would unlock opportunities in Nigeria’s Upstream Sector and expand access to affordable energy, job creation and socio-economic growth.
The renegotiated PSCs is a landmark achievement since NNPC transitioned to a limited liability company under the Company and Allied Matters Act (CAMA).
Persecondews recalls that the Petroleum Industry Bill of 2021 (PIB) was signed into law by Buhari on August 16, 2021 which gave NNPC the legal backing to renegotiate all its existing PSCs in conformance to the provisions of the new Act within a one year period.
Section 311(2) stipulates that new PSC agreements under new Heads of Terms will be signed between NNPC Ltd as Concessionaire and its Contractor Parties within one year of signing the PIA into law, giving a deadline of August 15, 2022.
In a statement on Saturday, a copy of which was given to Persecondnews, the company said the provision would pave the way for the resolution of lingering disputes that created investment uncertainty and stifled new investments in the nation’s deep offshore assets.
“To achieve this, NNPC Ltd leveraged on the near end term of the PSCs and the parties’ interest to renew the PSCs as a negotiation currency in bringing the contractors to work towards trading the past for the future.
“The renewed PSCs would provide several benefits such as improved long-term relationships with contractors, elimination of contractual ambiguities especially in relation to gas terms, enable early contract renewal amongst others.
“The signing of the new PSCs is a key milestone achievement by NNPC Ltd which would ultimately unlock opportunities within the Nigeria Upstream sector.
“The execution of the PSCs will deepen investment and development of Nigeria’s rich petroleum resources and ensure that the trifold mandate of the NNPC Ltd to ensure energy availability, sustainability, and accessibility is achieved.
“Ultimately, the new PSCs will provide inflow of Direct Foreign Investment, expanded access to affordable energy, job creation and socio-economic development,’’ it said.
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