SNEPCo Launches $3bn Contract Finance Facility to Boost Nigerian Contractors
The Shell Nigeria Exploration and Production Company Ltd (SNEPCo) has unveiled a $3 billion Contract Finance Facility in partnership with nine leading Nigerian banks, in a landmark initiative aimed at strengthening the capacity of indigenous contractors and deepening local participation in the country’s oil and gas industry.
The financing scheme, launched during the signing of a Memorandum of Understanding (MoU) in Lagos, is designed to provide much-needed credit support to Nigerian contractors executing projects for SNEPCo.
The facility will be accessible in both Naira and United States Dollars, enabling contractors to secure funding for project execution while improving operational efficiency.
The participating financial institutions are First Bank, Guaranty Trust Bank, Zenith Bank, Access Bank, United Bank for Africa (UBA), Stanbic IBTC, Standard Chartered Bank, First City Monument Bank (FCMB), and Fidelity Bank.
Speaking at the signing ceremony, SNEPCo Managing Director, Ronald Adams, described the initiative as a significant milestone in advancing Nigeria’s local content objectives and enhancing value retention within the country.
According to him, the financing arrangement embodies the vision of the Nigerian Oil and Gas Industry Content Development Act, which seeks to encourage greater participation of indigenous companies in the petroleum industry while ensuring economic benefits remain within Nigeria.
He explained that the partnership brings together the strengths of all stakeholders, with the banks providing capital and financial discipline, SNEPCo offering contracts and payment domiciliation to reduce lending risks, and contractors delivering quality project execution.
“The initiative reflects the spirit of the Nigerian Oil and Gas Industry Content Development Act, which is aimed at in-country value retention. Our partner banks offer capital and discipline. SNEPCo brings contracts and domiciliation of payments that de-risk lending. On their part, the contractors provide performance. Each is accountable to others, and the mutual accountability gives the arrangement its strength,” Adams said.
Also speaking, Vice President, Finance, Shell Nigeria, C. J. Akwaeze, noted that the facility underscores Shell’s continued commitment to supporting the growth and sustainability of Nigeria’s oil and gas industry by improving access to finance for indigenous service providers.
He said the initiative would enable local contractors to undertake larger and more complex projects, thereby enhancing operational efficiency and strengthening Nigeria’s local content achievements.
The Chairman of the Petroleum Technology Association of Nigeria (PETAN), Wole Ogunsanya, who was represented at the event by Dr Joan Faluyi, welcomed the initiative, describing it as a timely intervention that addresses one of the biggest challenges confronting indigenous contractors.
Faluyi said the scheme would serve as a gateway to resolving financing constraints faced by local companies, while also promoting faster and more efficient execution of oil and gas contracts.
Representatives of the participating banks also praised SNEPCo for spearheading the initiative, describing the collaboration as an important step towards empowering Nigerian businesses and driving sustainable growth across the energy sector. They pledged their continued support and cooperation to ensure the success of the programme.
The development further reinforces SNEPCo’s long-standing commitment to local content development and indigenous participation in Nigeria’s deepwater oil operations.
Earlier this year, Nigerian companies demonstrated their growing technical capacity during the turnaround maintenance exercise on the Bonga Floating Production Storage and Offloading (FPSO) vessel, where 43 wholly Nigerian companies participated out of the 53 firms involved in the project.
Industry stakeholders believe the new Contract Finance Facility will build on such achievements by improving contractors’ access to capital, strengthening project delivery capabilities, creating more opportunities for indigenous firms, and supporting the long-term growth of Nigeria’s oil and gas sector.
The initiative is expected to significantly enhance the capacity of Nigerian companies to deliver greater value across SNEPCo’s operations while consolidating the position of Nigeria’s premier deepwater producer as a leading advocate of local content development.
