â€¢ Supports Nigerian contractors with N472bn loans
The Managing Director of Shell Petroleum Development Company (SPDC) and Country Chairman of Shell Companies in Nigeria, Mr. Osagie Okunbor, has stated that the SPDC JV partners made an economic contribution of $23 billion (N5.31trillion) to the Nigerian Government between 2013 and 2017.
This is coming as some 290 Nigerian contractors have received loans worth more than N472 billion under the Shell Contractor Support Fund, which was set up by Shell companies in Nigeria to help vendors and suppliers in the oil and gas industry secure funds at reduced interest rates, relaxed collateral requirements and quicker processing time.
Speaking in Lagos yesterday when he presented Shellâ€™s 2018 briefing notes, Osagie stated that the Shell Companies in Nigeria are major contributors to the Nigerian government, not only through the energy they produce and the revenue they generate for the country, but also through their extensive supply chain, local content and social investment.
He also disclosed that the SPDC JV partners and the Shell Nigeria Exploration and Production Company (SNEPCo) had contributed $1.9 billion (N338.12 billion) to the Niger Delta Development Commission (NDDC) since the inception of the agency in 2002.
Osagie, who was accompanied by the Managing Director of SNEPCo, Mr. Bayo Ojulari, added that the average daily production by Shell-operated ventures in Nigeria in 2017 was 631,000 barrels of oil equivalent per day.
According to him, $228 million (N41.10 billion) social investment funds were disbursed for community-driven projects under the Global Memorandum of Understanding (GMoU) structure by SPDC JV since inception in 2006.
The Shell Country chairman further revealed that Shell companies in Nigeria awarded contracts worth over N230 billion to Nigerian contractors in 2017, representing 94 per cent of the total contracts in that year.
â€œWe are pleased to support Nigerian contractors to play greater roles in the oil and gas industry. As pioneers in the industry we have taken deliberate steps to award contracts to Nigerian vendors and worked with them to grow their capacity, cost efficiency and delivery timelines. We discovered however, that access to finance has been a challenge, and the search for a solution led to the Shell Contractor Support Fund,â€ Osagie explained.
He noted that the Shell companies started their intervention in 2011 with the Shell Kobo Fund, which gave way to the Shell Contractor Support Fund the following year with seven participating financial institutions which have since set aside more than N690 billion for contract execution by Nigerian companies.
He listed the banks to include: Access Bank Plc, Skye Bank Plc, Zenith Bank Plc, Stanbic IBTC Bank, First Bank of Nigeria Limited, Standard Chartered Bank and Guaranty Trust Bank.
The Shell Nigeria boss also disclosed that Nigerian ownership of key assets such as rigs, helicopters and marine vessels is also a focus, with Shell companies providing technical and financial support to companies across a range of sectors including transportation, manufacturing and research and development.
On social investment, Okunbor said Shell companies had continued to work with the government, communities and civil society to fund and implement projects and programmes that have a lasting impact on peopleâ€™s lives in the Niger Delta and Nigeria as whole.
â€œFor example, since 2006, the SPDC JV has disbursed more than N41 billion to 37 active Global Memorandum of Understanding (GMoU) clusters in Rivers, Delta, Bayelsa and Abia States. A GMoU is an agreement that brings a group (or cluster) of communities together with representatives of state and local governments, SPDC and NGOs, with the SPDC JV providing five-year funding for communities to implement development projects of their choice,â€ he said.
â€œSocial investment activities of Shell companies focus on community and enterprise development, education, health, access-to-energy and since 2016, road safety. In 2017, SPDC JV, Shell Nigeria Exploration and Production Company and Shell Nigeria Gas spent more than N 18 billion on direct social investment projects. Nigeria is the largest concentration of social investment spending in the Shell Group,â€ he added.