“Uncertainty”, “disruption” are terminologies that have been regularly deployed since the outbreak of the COVID-19 pandemic, whether in relation to economies, businesses, supply chains, industries, sectors etc. Given the uncertainties and disruptions created by the COVID-19 pandemic, most organizations are adopting a flexible and changing approach in handling the health crisis and putting out the fires caused by COVID-19. A flexible and changing approach allows organizations to constantly evolve, refine and update their plans, actions and strategies in dealing with the challenges posed by COVID-19.
In the Nigerian oil and gas industry (the “Industry”), the Department of Petroleum Resources (the “DPR”) is also adopting a flexible and changing approach in providing guidance to operators, contractors and service providers in the Industry. It does this by issuing regular updates and guidelines on the management of the COVID-19 pandemic, particularly in relation to the health and safety of personnel, which is in line with the statutory mandate of the DPR. It is worth noting that by the Petroleum (Drilling and Production) Regulations 1969 (as amended), Industry operators are required to comply with all existing safety regulations and all such instructions as may be given by the Director of Petroleum Resources, aimed at securing the health and safety of persons engaged on or in connection with operations.
In a recent guidance circular to Industry operators and service providers, the DPR shared recommended practices that are proving effective in managing the spread of COVID-19, particularly in offshore and other remote locations. We discuss the recommended practices below.
a. Anchor Principles – The DPR noted that the strategies adopted by operators to manage the COVID-19 pandemic are anchored on health and safety of personnel, compliance, stakeholders’ alignment, ensuring work-life balance, leveraging technology and ensuring business and operational continuity. The principles noted by the DPR demonstrate an interplay among company + people + stakeholders + regulators + technology. To withstand the setbacks caused by COVID-19 and operate optimally in a post-COVID-19 world, businesses (not just operators in the Industry) must adopt strategies that strike a fine balance between the needs of the company, the wellbeing of employees, effective stakeholder (including client/customer) engagement, the regulatory environment and utilization of technology.
b. Maintenance of Transit Centre - To combat the spread of COVID-19, the DPR noted that most offshore operators maintain a transit centre in an onshore facility where intending offshore workers are isolated and monitored prior to embarkation for a 14/14/14; 14/28/14; or 14/28/28 days cycle of transit centre/offshore/off-duty. Industry operators are therefore required to ensure that a minimum of 14 days of isolation period prior to embarkation is included in their protocol for management of COVID-19. According to the DPR, this will ensure that asymptomatic carriers are not missed out.
c. Trauma Prevention - To prevent psychological trauma and emotional imbalance as a result of the isolation of personnel prior to embarkation, the DPR directed that isolation centres should be made conducive. The psychological impact of isolation is an important aspect that Industry operators and service providers must consider critically in their health and safety protocol for the management of the COVID-19 pandemic. We suggest that Industry operators should also set-up an online doctor-on-duty platform that guarantees round the clock access to qualified mental health practitioners when required by isolated personnel.
d. Disembarkation Protocol - In respect of disembarkation, the DPR noted that generally there were no requirements for supervised isolation of offshore workers immediately after disembarkation, on the basis that offshore facilities are inherently controlled and isolated.
e. COVID-19 Testing - The DPR noted that some operators have commenced COVID-19 testing and other operators are making plans to acquire appropriate test kits. To ensure that the test results are reliable and prevent panic that may arise from inaccurate testing by operators, the DPR directed that all companies should ensure that the COVID-19 test kits acquired and the testing procedures used, conform to the Nigeria Centre for Disease Control (NCDC) and World Health Organization standards. Regarding the acquisition of test kits, we suggest that an approach that the DPR may adopt to guarantee that standards are maintained, is to collaborate with the NCDC for recommendations on COVID-19 test kits manufacturers and suppliers.
f. Industry Collaboration - Considering the business challenges faced by Industry operators, contractors and service providers, particularly with the low crude oil price scenario, Industry stakeholders must undoubtedly collaborate to ensure a fair and balanced approach in dealing with such challenges. In this regard, the DPR acknowledged the collaboration and understanding displayed by Industry unions in the implementation of the modified rotation schedule and other company-specific measures. Given the evolving nature of COVID-19 and the flexible approach required to address challenges posed, the DPR also enjoined Industry unions to maintain a high level of cooperation with their respective companies during this period. We believe that an open-dialogue approach between Industry unions and companies is a recommended strategy that should be adopted by companies in dealing with any employment issues to avert potential business and operational disruptions, which may arise from a labour stand-off.
g. Reporting Obligation - Operators are mandated to promptly report any case of COVID-19 in their offices, locations or installations to appropriate authorities and the DPR. It is important to note that all information supplied to the DPR are statutorily required to be treated as confidential – the confidentiality obligation placed on the DPR should provide comfort to operators and the affected personnel that the privacy of the affected personnel will be maintained.
h. Onshore Operations/Host Community Interface - The DPR also recommended that similar health and safety measures should be adopted for onshore field locations where interface with host communities and local workers is prevalent in order to complement ongoing COVID-19 containment efforts implemented by the government. Given that the health facilities in some host communities are either dismally sub-standard or completely unavailable, and any health crisis in those communities may therefore be devastating due to their vulnerability, this directive by the DPR is critical - operators must take care to ensure that their personnel adopt and adhere strictly to appropriate precautionary measures.
i. Focused Approach – The DPR also directed all operators, service providers and contractors to remain focused in implementing established protocols at all locations and be alert to further government directives. During these unprecedented and challenging times, decision makers and business leaders must remain focused and resilient in the implementation of action plans; however, an open-mind approach should also be adopted to provide sufficient incubation space for new ideas and solutions as we gear-up for a new but unknown reality.
It is important to laud the responsive leadership role that the DPR has adopted during this COVID-19 pandemic by taking steps to ensure business and operational continuity in the Industry and provide guidance to Industry operators, contractors and service providers in combating the spread of COVID-19. The battle is however still on, the collaboration between Industry stakeholders must therefore be maintained to ensure that the disruptions on the Industry are minimized as best as possible and effectively managed.
The contents herein are meant for the general information of our clients and friends and do not amount to legal advice. Adepetun Caxton-Martins Agbor & Segun accepts no responsibility for any loss or damage that may arise from reliance on information contained in this publication. All enquiries may be made to Chinedu Kema email@example.com
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