The Nigerian Content Development and Monitoring Board (NCDMB) Tuesday said Nigeria had recorded an estimated capital flight of about $380 billion between 1956 when oil was discovered and 2006 before the Nigerian content policy was initiated.
The board also stated that the country’s oil and gas industry has exported approximately two million job opportunities to other countries outside Nigeria within the 50 years period of operation by sundry operators in the sector.
These figures were disclosed to the inaugural members of the local content committee of the House of Representatives by the Executive Secretary of NCDMB, Mr. Ernest Nwapa.
The committee was hosted by the Board on a recent capacity building workshop to make things clear to them on the processes and workings of the local content policy.
A statement reflecting this development was issued by the public affairs officer of NCDMB, Mr. Obinna Ezeobi, in Abuja, in which Nwapa also sought the cooperation of members of the committee to effectively implement the provisions of the Nigerian Oil and Gas Industry Content Development Act 2010.
Nwapa noted that with over 95 per cent of the industry’s annual budget expended abroad within the 50 year period, the Board hopes to consolidate on the modest successes it has recorded so far to avail Nigeria the leverage of becoming the hub of oil and gas services by 2020.
He explained that with this in place, Nigeria could quickly retain an estimated of $191 billion and 300,000 new job opportunities created in engineering, sciences and technical services, and at the same time, domiciling over 65 per cent of the total industry expenditure.
While he specifically drew the attention of the committee to some policies and practices that impair local content development in Nigeria, like the Temporary Import Permit (TIP) for marine vessels, Nwapa said that TIP discourages indigenous ownership and registration of marine vessels in Nigeria, thus, giving advantages to foreign vessel owners.
He said, “The TIP not only discouraged the ownership and registration of marine vessels in Nigeria but also gives advantages to foreign vessel owners, who are allowed to pay a token to the government for bringing in their vessels.
Furthermore, it promotes the practice whereby vessels that work in Nigeria sail to neighbouring countries to meet their TIP conditions and undergo repairs concurrently whereas such maintenance can be done at ship yards in Nigeria.”
Also, Nwapa identified the marine sector as one of such area with high impact in employment, retention of industry spend, technology transfer and value added services which the Board’s implementation strategies has been remarkable.
According to him, the sector used to be dominated by foreign owned and crew vessels and rig operators, resulting in three billion dollars capital flight but with the Board’s marine vessel and rigs ownership strategy, the status quo is changing with increased indigenous participation.
“Indigenous players are currently participating fully in the smaller vessel category, thereby retaining about one billion dollars annual spend in Nigeria while a structured intervention for more Nigerian ownership of the larger offshore vessels has been put in place, with a potential for retaining a further $1.5 billion in the next two years.
There is optimism, however, that the current drive by the Board will ensure that by 2020, the ownership profile in the marine sector would be more indigene driven with a retention in excess of $4 billion per annum, 250,000 employment and training opportunities,” Nwapa stated.