New Telegraph

February 22, 2024

Nigeria forecloses attaining 100% local content in oil sector

Nigeria, Africa’s biggest crude oil exporter, has ruled out advocacy and attainment of 100 per cent local content in its oil and gas sector.

 

Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Simbi Wabote, who said this, maintained that his board was not advocating 100 per cent Nigerian content in the oil and gas industry.

 

“If the board wants to implement the Nigerian Content Law 100 per cent, it would have to stop oil production in Nigeria, develop non-existing capacity and then start production again,” he said.

 

“Minimum Nigerian content levels for various industry activities were set in the schedule of the NOGICD Act,” the executive secretary said, adding that “in several areas like engineering where we had 90 per cent target, we have surpassed the target and we are doing 95 per cent and even 100 per cent in some areas.

 

In the low voltage electric cables production, we have also surpassed what the Act prescribed. Similarly, there are some areas where we have not met the set target.

 

“One of such areas is LNG, which uses specialised and proprietary technology for something like the pressure vessels and the funding are often tied to technology. “However, I want to clarify that NCDMB is not advocating 100 per cent Nigerian content in the oil and gas industry.

If we are to implement the Nigerian Content Law 100 per cent, we will have to stop oil production in Nigeria, develop nonexisting capacity, and then start production again,” said.

 

According to him, Section 53 of the NOGICD Act mandates that all fabrication and welding activities must be carried out in Nigeria.

 

“But there are not enough dockyards in-country where the hull of big vessels such as the Egina FPSO could have been fabricated from scratch. “Ninety-five per cent of our construction in the oil industry is steel, yet we do not have a functional steel mill in Nigeria.

 

“The oil and gas industry depends on sectoral linkages, including the power sector to deliver and some of those sectors are not well developed,” he added.

 

He also stated that local content was a marathon race and not a sprint and that is why NCDMB enforces the law with pragmatism.

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