Oil firm, 7 banks earmark N690bn for local firms
The yearly contracts awarded by the Shell, biggest international oil firm in Nigeria in terms of assets and production, hit N230 billion in 2017, a 94 per cent of the total contracts in that year.
Seven Nigerian banks including 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 company, said in a document obtained by New Telegraph, have also set aside N690 billion for Nigerian companies’ contract execution.
Some 290 Nigerian contractors, the document entitled; “2018 Shell Nigeria Briefing Notes” states, had also received loans worth more than N472 billion under the Shell Contractor Support Fund.
The fund 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.
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 had since set aside more than N690 billion for contract execution by Nigerian companies. The lender’s are the seven banks listed above.
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.
Country Chair Shell Companies in Nigeria and Managing Director of The Shell Petroleum Development Company of Nigeria (SPDC) Ltd, Mr. Osagie Okunbo, according to the Briefing Notes, said: “We’re 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.”
On social investment, Mr. 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 people’s lives in the Niger Delta and Nigeria as whole. For example, he said 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.
Social 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 N18 billion on direct social investment projects. Nigeria is the largest concentration of social investment spending in the Shell Group.
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