The Nigerian Content Development and Monitoring Board says it is determined to enforce provisions of the Nigerian Content Act for indigenous and international oil companies operating in the country.
Ernest Nwapa, its executive secretary, said Monday, in Abuja, at the 14th International Health, Safety and Environment (HSE) Biennial Conference on the oil and gas industry in Nigeria, that this is part of government’s imperative to realise the Nigerian content development agenda.
Mr. Nwapa said until 2004, there was very low local capacity in Nigeria’s petroleum industry, with about 95 percent of goods and services imported, while the introduction of the Nigerian Content Policy has improved local capacity to about 35 percent.
He said government agenda is to identify and close all capacity gap business opportunities in dry dock integration, shipyards, heavy industries, pipe mills, equipment manufacturing, and service companies’ training in the industry.
Part of government’s expected impact on the national Gross Domestic Product (GDP) in the next four years, the NCDMB scribe said, is to ensure that at least $10 billion of an average annual petroleum industry expenditure of $20 billion is retained within the local economy, while about 30,000 direct employment and training opportunities are domiciled in Nigeria through the implementation of the policy.
To ensure that capacity building projects are not stifled by lack of funding, he said government has launched the Nigerian Content Development Fund (NCDF), a central pool of financing, in collaboration with the Central Bank of Nigeria (CBN) and commercial banks, for certified beneficiaries.
Cost effectiveness
“Local capacity building will improve cost effectiveness and certainty of supply by reversing the trend of 100,000 jobs currently created abroad by the international oil companies, through the continued outsourcing of service contracts to companies outside the country,” he said.
“Henceforth, government, through the provisions of the NCD Act, would ensure that no other vessel is allowed to work if a vessel owned by a Nigerian working in the nation’s oil and gas industry is not put to work first. Any equipment working in Nigeria must be partly-owned by a Nigerian before it is allowed to work.
“This is the only way to reverse the current practice where nine out of 10 cents paid for equipment in the industry are not domiciled in Nigeria,” he said.
However, John Mpi, manager, business development, Nigerian Agip Oil Company (NAOC), however, expressed skepticism over the policy prospects, if government does not pay serious attention to human capacity development issues.
Mr. Mpi said it is sad that the industry has nothing significant to show for its 50 years of existence, saying there is need for the indigenous companies to model their operations after the successful international oil companies, in terms of setting key performance indicators to measure their success and growth as well as strict supervision.