The Nigerian Content Development and Monitoring Board, NCDMB said it is set to begin the enforcement of the Nigerian Content Act in the midstream and downstream sectors of the Nigerian oil and gas sector of the economy.
The midstream and downstream sectors comprise refining, processing, petrochemical and petroleum products marketing among others.
Executive Secretary of the NCDMB, Mr. Simbi Wabote, in a forum in Yenagoa, Bayelsa State, said that this year, the NCDMB had undertaken a reorganisation of its monitoring structures to enable it pay much more attention to the implementation of Nigerian Content in the midstream and downstream sectors of the industry.
He also said that it had stopped oil and gas companies from undertaking pipes coatings outside the shores of the country, adding that specifically, it has ordered the Nigerian National Petroleum Corporation, NNPC, and other companies to patronise indigenous pipe coating companies.
According to Wabote, who was also giving a scorecard of his first 100 days in office, there are currently about six pipeline coating companies in the country, adding that with the coming on stream of these companies, pipe coatings which was normally done abroad are now done in-country.
He disclosed that as at today, Nigerian content in the oil and gas industry is about 28, per cent, noting that the country is still far away from its target and is seriously working to deepen it.
He identified the inability of a vast number of oil and gas operators to access the $600 million Nigerian Content Development Fund, NCDF, as a major setback for the NCDMB, as well as the refusal of many operators to contribute to the fund.
He said, “One question I have had to answer repeatedly in the last 100 days has to do with the Nigerian Content Development Fund (NCDF). In the last seven years, the NCDF has grown to nearly $600 million but only three service companies successfully accessed the Fund.
“Despite the healthy growth of the Fund, we are frustrated that it has not significantly addressed the purpose for which it was established by the Act.”
Wabote, however, declared that within the last 100 days, the NCDMB had worked on various strategies geared to improve access to the Fund, adding that the Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu and other members of the NCDMB Governing Council are even more determined to quickly deploy this Fund to good use.
“We are hopeful that clear modalities that will guide the utilization of the Fund will be out within the next 100 days,” he maintained.
He added that the NCDMB is working assiduously with other stakeholders to drastically bring about a reduction in the contracting cycle from about two years as it currently obtains to about six months, in line with the policies of the Federal Government.
According to him, the long contracting cycle was responsible for the high cost of production of Nigeria’s crude oil compared to its peers in OPEC.
He said, “When I assumed office, I took on the lingering issue of protracted contracting cycle in the industry. With support from my team we have put in place internal performance measures to fast track the contract processing time from NCDMB’s end.
“We have committed to specific timelines for review of Nigerian Content plans, technical & commercial evaluation and issuance of Nigerian Content certificates
“It is my believe that other agencies involved in the contracting cycle are working on their internal processes so that we can collectively work together to reduce the protracted contracting cycle, which has been identified as the main cause of the high cost per barrel of Nigerian crude in comparism to other OPEC countries.
“It will also help revitalize the tempo of Nigerian Content implementation as investors begin to develop more confidence in the Nigerian business environment.”
