Shell Nigeria Exploration and Production Company Limited has partnered with nine Nigerian banks to launch a $3 billion Contract Finance Facility aimed at improving access to funding for indigenous oil and gas contractors executing projects for the company.
According to a statement issued on Thursday, the financing programme will provide credit support in both naira and United States dollars to local contractors handling SNEPCo projects.
The participating lenders are First Bank of Nigeria, Guaranty Trust Bank, Zenith Bank, Access Bank, United Bank for Africa, Stanbic IBTC Bank, Standard Chartered Bank, First City Monument Bank and Fidelity Bank.
Speaking at the signing of the Memorandum of Understanding in Lagos, Ronald Adams said the initiative supports the objectives of the Nigerian Oil and Gas Industry Content Development Act by encouraging greater value retention within the country.
He said the arrangement combines financing from partner banks, contracts and payment domiciliation from SNEPCo, and performance by contractors to reduce lending risks and strengthen project execution.
The Vice President, Finance, Shell Nigeria, CJ Akwaeze, said the facility reflects the company’s commitment to supporting the growth of Nigeria’s oil and gas industry through improved access to financing.
The Chairman of the Petroleum Technology Association of Nigeria, Wole Ogunsanya, who was represented by Joan Faluyi, described the financing scheme as a major boost for indigenous contractors.
He said the initiative would help address long-standing financing challenges facing local service providers while improving efficiency in project delivery.
Representatives of the participating banks also welcomed the partnership, saying it would strengthen the financial capacity of indigenous contractors and improve their ability to execute oil and gas projects.
SNEPCo noted that Nigerian companies continue to play an increasingly important role in its operations. According to the company, 43 of the 53 firms that participated in the recent turnaround maintenance of the Bonga Floating Production Storage and Offloading vessel were wholly Nigerian-owned.
The company said the new Contract Finance Facility is expected to further build the capacity of local contractors and enhance value delivery across its deepwater operations in Nigeria.
