In response to COVID-19, various policies and regulatory measures have been introduced by the Federal Government of Nigeria (FGN) and its agencies (such as the Department for Petroleum Resources (DPR)), and by various state governments. We highlight below some of the key developments which should be borne in mind by companies active in this sector.
DPR Directives in response to COVID-19 outbreak: Following the infection of six workers on the Siem Marlin offshore rig – an offshore oil rig in Lagos State, the DPR directed oil and gas firms to reduce the workforce on offshore platforms and at project sites. In its Circulars published on 29 and 30 March 2020, the DPR expressly stated that “the current situation is considered ‘force majeure’” and directed as follows:
- offshore travel would now require an offshore safety permit;
- all non-essential staff are to be withdrawn from the offshore locations and only essential staff are permitted to travel; and
- staff rotation at these locations to be at least 28 days.
Note: the withdrawal of non-essential staff from offshore installations may affect the ability of contractors and sub-contractors to perform their obligations (particularly as “non-essential staff” was not defined). Since “force majeure” is usually defined in the contract it is unclear what legal value may be accorded to the DPR’s recognition of the COVID-19 pandemic as “force majeure”. Nonetheless, we expect that many organisations will seek to rely on the DPR’s declaration as law.