The Nigerian National Petroleum Corporation (NNPC) has commenced the processing of documents produced by international oil traders that submitted applications for the 2012/2013 crude oil lifting contracts worth over $30billion, THISDAY has learnt.
It was gathered that the processing of the documents followed the May 11, 2012 expiration of submission of applications by interested bidders.
In the initial request for applications from interested bidders, the NNPC had set the deadline for April 5 in the notices it released on March 21 and 22.
Both following concern raised over Nigerian Content by the Nigerian Content Development and Monitoring Board (NCDMB), the corporation in a fresh notice issued on April 27 extended the deadline for companies to submit applications for crude oil term contracts to May 11.
The extension was to ensure that the foreign traders that sign the contracts comply with the Nigerian Content Act.
Group General Manager in charge of the Group Public Affairs Division of the NNPC, Dr. Levi Ajuonuma, could not be reached through his mobile phone to comment on the issue but a source close to the corporation told THISDAY that the applications received from the traders were being processed.
He confirmed that the 2012/2013 tender worth over $30billion would run for 12 months, beginning from the end of this month or early June 2012, after the successful bidders have emerged.
"It is too early to know who is successful or not because they have just started processing the applications," he said.
Under the new guideline that necessitated the extension to May 11, the traders were asked to submit a detailed Nigerian Content execution strategy to the satisfaction of the NCDMB, clearly setting out Nigerian Content commitments for subcontracting in some selected areas of the economy.
To ensure that the traders comply with the Act, they were required to provide commitment from prospective shippers to lift Nigerian crude that "a minimum of five slots per cargo shall be set aside for ocean-going attachment of Nigerian cadets for the purpose of obtaining international certification."
"Interested applicants must submit a Memorandum of Agreement with shippers demonstrating a credible strategy to grow Nigerian equity in the tankers nominated to lift allocated Nigerian crude to 25 per cent by 2014 and 90 per cent by 2017. It should be noted that evidence of Nigerian equity in the nominated tankers prior to conclusion of the process shall give trader competitive advantage," said the guidelines.
Swiss-based Vitol, Glencore and Amsterdam-based Trafigura are some of the foreign traders that cornered most of the previous term contracts.