NCDMB Advocates Annual ‘Final Investment Decision Week’ to Meet Oil Production Growth Target

As part of strategies to increase Nigeria’s crude oil production and enhance revenue accruing to the national treasury, the Nigerian Content Development and Monitoring Board (NCDMB) has advocated the introduction of a one-day annual programme dedicated to signing final investment decisions (FIDs) on new oil and gas projects. 

Executive Secretary of NCDMB, Felix Ogbe, made the proposal on Wednesday in his presentation at the ongoing 2024 African Oil Week, holding in Cape Town, South Africa.    

Ogbe also announced that NCDMB had applied the presidential directives in approving five oil and gas projects, which were currently in the funnel. He said the projects had expected production values of one billion standard cubic feet of gas per day (1bcfp/d) and 350,000 barrels of crude oil per day (bpd).

An FID is the final point in an energy project in which the company or partners owning and operating a project give the final approval for development and releasing of funding for commencement. 

Ogbe stated that the FID week, if adopted, could be incorporated into the existing annual international oil and gas conferences, and would feature international and indigenous operating companies.

He posited that dedicating one week every year to FID signing could compel companies and relevant regulators to fast-track their processes to meet the deadline. 

Ogbe also indicated that the idea of an annual FID week had already been broached to Special Adviser to the President on Energy, Mrs. Olu Verheijen, the leadership of the Nigerian National Petroleum Company Limited (NNPC), and international operating companies. He said the proposal was being considered.

The NCDMB helmsman was represented at the African Oil Week by Director, Projects Certification and Authorisation Division (PCAD), NCDMB, Abayomi Bamidele.

He said the proposal for an annual FID Week was geared towards addressing the insufficient FIDs signed by the operating companies and the limited number of new projects being developed in the Nigerian oil and gas industry. 

These worrisome developments, according to him, contributed to Nigeria’s dwindling crude oil production and the negative impact on revenue.

Ogbe suggested that the Nigerian oil and gas industry needed to have at least one or two FIDs on major projects to be signed every year, to catalyse activity in the local service sector and the national economy, and ultimately increase crude oil and gas production and revenue for the country.

Making reference to the three Presidential Directives (PDs) rolled out by President Bola Tinubu in March for the oil and gas industry, the NCDMB boss said the agency had complied fully with the directives as it related to fast-tracking the contracting cycle and eliminating middlemen with no demonstrable capacity from participating in the oil and gas value chain. 

The PDs included Presidential Directive on Local Content Compliance, Presidential Directive on Reduction of Petroleum Sector Contracting Cost and Timelines, and Presidential Directive on Oil and Gas Companies (Tax Incentives, Exemption, Remission, among others).

Ogbe announced that NCDMB had applied the presidential directives in approving five oil and gas projects, which were currently in the funnel. 

He hinted that the expected production values of those projects are one billion standard cubic feet of gas per day and 350, 000 barrels of crude oil per day. 

Commenting on strategies that would ensure sustainable local content development in African nations, the executive secretary stated that local content had to be promoted as a national agenda and supported by all institutions, businesses, decision-makers, investors and citizens.

Peter Uzoho

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