The Federal Government of Nigeria through the Department of Petroleum Resources (“DPR”) recently disclosed its intention to commence the enforcement of the requirement for oil producing companies to submit production data of crude oil pursuant to the provisions of the Petroleum (Drilling and Production) Regulations, 1969 (the “PDPR”).
Under the PDPR, licence/lease holders are required to, inter alia, keep full and accurate accounts of the quantity of crude oil won and saved from the licence/lease area and submit the same as specified by the DPR. To facilitate compliance with this requirement, the DPR established the National Production Monitoring System (“NPMS”), which provides an online platform to accurately monitor national crude oil production. All oil producing companies are required to submit their production data through the NPMS.
According to the DPR, some oil producing companies are yet to comply fully with their data submission obligation in contravention of the PDPR. To ensure compliance, the DPR now intends to link compliance with the NPMS data submission obligation to some of its regulatory processes, such as issuance of export permits and other statutory approvals/permits.
Considering the potential adverse impact of non-issuance of export permits to their operations and businesses, oil producing companies are advised to immediately commence steps towards complying fully with their data submission obligation. This will ensure that they are optimally placed to continue to obtain relevant permits and licenses from the DPR, and ultimately, that they are able to run their businesses without interruption.
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