By TOM CHIAHEMEN, Lagos –
It has been revealed that prior to the adoption of local content by the Obasanjo Administration, the Nigerian Oil and Gas industry was characterized by massive capital flights of over $380 Billion and an estimated two million job losses over a 50-year period.
Also, while the local content in the Oil and Gas industry was less than 5%, there was revenue focus with little emphasis on in-country value addition.
Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Engr. Simbi Wabote, made this known during a Breakfast Meeting with members of the Guild of Corporate Online Publishers (GOCOP), in Lagos at the weekend.
Speaking on local content journey in Nigerian oil and gas industry, Engr Wabote recalled that sometime in 2004,former President Olusegun Obasanjo directed the Nigerian National Petroleum Corporation (NNPC) to introduce Local Content Policies in the oil and gas industry as part of Nigeria’s national economic development imperatives.
He noted that following the presidential directive, NNPC issued 16 Directives in 2005 and 23 in 2006 to drive local content as a key development imperative, adding that these directives “further raised the consciousness in the oil and gas industry and moved the needle a bit in getting some in-country value addition across the oil and gas value chain.”
“Having witnessed initial resistance to the NNPC Directives by most of the E & P companies, Government felt it was imperative to give legal backing to the directives and provide an all-encompassing framework for the development of Nigerian Content in the oil and gas industry. Hence, the NOGICD Act was enacted in 2010 and signed into law on 22nd April 2010,” he said.
He explained that the NOGICD Act, 2010 established NCDMB as the sole agency of the Federal Government with the responsibility for driving Nigerian Content in the oil and gas industry.
Engr Wabote,while stressing thatthe focus of the NOGICD Act was not “Nigerianization” of the oil & gas industry, but “Domiciliation” and “Domestication” of value-adding activities,stated thatNigerian Content as defined by the NOGICD Act, was “the quantum of composite value added to or created in the Nigeria economy by` a systematic development of capacity and capabilities through the deliberate utilization of Nigerian human, material resources and services in the Nigerian oil and gas industry.”
Outlining some of the achievements of the NCDMB so far, Engr Wabote noted that before the Act, “we had annual spend of $20 billion, with little or nothing retained in-country. (but) today, we now spend more than $8 billion in-country per year.”
He further said:
“We now have 2 world-class pipe mills and 5 impressive pipe coating yards. More than 40% of marine vessels used in the oil and gas industry are now owned by Nigerians.
“In fabrication, today Nigeria can handle fabrication of more than 250,000 Tonnes per annum.
“Over 10 million training manhours have been delivered via our Human Capacity Development Programs. No surprise that our indigenous workforce was able to sustain oil production at the peak of the COVID-19 pandemic lockdown.
“Over 50,000 direct jobs have been created on the back of the implementation of the NOGICD Act.
“Completion and commissioning of our 17-storey headquarters building – the Nigerian Content Tower in Yenagoa, complete with a 1,000-seater conference auditorium and multi-level car park.
“Completion of 10MW power plant for the supply of electricity to the Nigerian Content Tower and the industrial park in Bayelsa State.
“Completion and commissioning of the 5,000bpd Waltersmith Modular Refinery at Obigwe, Imo State; the refinery is currently in operation with the products completely sold out.
“Launching of the $350million Nigerian Content Intervention Fund managed by the Bank of Industry and NEXIM Bank for single digit loans for Asset Acquisition, Manufacturing, Loan Refinancing, Working Capital and Loan for Women in Oil and Gas.”
Engr Wabote said the only infrastructure in Africa for FPSO integration was available in Nigeria, adding, “the Egina FPSO which is the largest in the world was integrated at the SHI-MCI Yard in Lagos.”
He also named the completed GSM training scheme for about 4,000 trainees in Kano, Bauchi, Yobe, Kaduna, and Cross River States as part of development of linkage sectors, as well as the completion of the upgrade of two Vocational Technical Colleges in Akwa Ibom and Enugu states.
Continuing, he said the NCDMB inaugurated a $50million Nigerian Content Research & Development Fund to drive basic research, commercialization of research breakthroughs, establishment of Centers of Excellence, and to sponsor University endowments.
The Board also floated a $50m special loan product for women in the oil and gas business to enable empowerment of the womenfolk in the industry, just as it established another $30m Working Capital Fund to support oil and gas service companies. Both the Women and Working Capital funds are managed by Nexim Nigerian Export-Import Bank.
“Last Thursday we secured the approval of our Governing Council to set up a USD$50 million fund for NOGAPS Manufacturing Product Line, to be dedicated to companies that would operate in the Nigerian Oil and Gas Parks, being constructed by the Board in Bayelsa and Cross River States. The beneficiaries would engage in the manufacturing of equipment components used in the oil and gas industry and linkage sectors,” Engr Wabote said.
He further spoke of the construction of oil and gas industrial parksspread across six states complete with the provision of infrastructure and utilities to enhance local manufacturing, and “Partnership for the local manufacturing of 1.2million composite LPG cylinders per year with the 1st phase scheduled for commissioning in 2022.”
Other Partnership are for the establishment of additional modular refineries in Bayelsa and Edo States; construction of 300MMscfd gas gathering hub for gas supply into the OB-3 pipeline in Edo State; deepening LPG utilization in the North with the roll-out of LPG bottling plants and depots in ten (10) Northern States of Kaduna, Bauchi, Katsina, Kano, Nasarawa, Niger, Plateau, Gombe, Zamfara, Jigawa and Abuja and; establishment of base oil manufacturing plant in Omagwa, Rivers State.
Outlining a few of the achievements recorded by the NCDMB through the adoption and implementation of local content in the oil and gas industry, Engr Wabote said.:
“We now boast of very high engineering design capacity as Nigerian companies now have the required skills to do conceptual, FEED, and detailed engineering designs.
“We now have capacity to manufacture low, medium, and high voltage cables and paints that can match any standard or quality in any part of the world.”
Now that Nigeria has a well-established local content in the oil and gas industry such that other nations are even coming to learn from us, Wabote said that what was now needed was to extend it to other sectors of the economy to further drive our National Development in the growth trajectory.
On future plans, Wabote said: “our plan in NCDMB is that by 2027, we will ensure 70% Nigerian Content; creation of 300, 000 direct jobs; retention of USD$13Bn of the estimated USD$20Bn spend in the oil and gas industry; ensure the domiciliation of major fabrication yards and manufacturing hubs in-country. These are no mean targets we have set for ourselves.”
He declared that the Nigerian Content imperative was a journey, a marathon one for that matter. “We will require all hands to join forces with NCDMB and government to pursue this cause in ensuring that the benefits of the oil and gas industry is retained maximally in Nigeria.”
Engr Wabote expressed his gratitude to GOCOP and its members for the support they have provided to the Board in the last five years that he had been on the saddle as the Executive Secretary, just as he emphasised the need for media practitioners, especially in the online media, to self-regulate and checkmate your colleagues who have deployed their platforms to propagate falsehood and perpetrate extortionist practice.
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