Menu

Conference on local content in oil & gas to hold in Yenagoa

29 Sep 2015
Financial Nigeria

Summary

The law has enhanced the local capacity development initiatives of some multinationals.

Emmanuel Ibe Kachikwu, Group Managing Director of the Nigerian National Petroleum Corporation

The Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Mr Denzil Amagbe Kentebe, will address the oil and gas industry in October at the Practical Nigerian Content Forum (PNC). The Forum, which will hold in Yenagoa, Bayelsa State, will discuss the implementation of Nigerian content law as a crucial tool for wealth creation and capital retention for the growth of the Nigerian economy at a time of shifting global energy markets and fallen oil prices.
 
The Nigerian Oil and Gas Industry Content Development Act (NOGICDA), signed into law by former Nigerian President Goodluck Jonathan in 2010, prescribes the prioritization of indigenous operators in the oil and gas industry in giving consideration for awarding contracts and licences, training and employment opportunities and particular preference to domestically manufactured goods.

The law enhanced the local capacity development initiatives some multinationals were already undertaking. It also enabled others to work towards compliance. In a statement released by the NCDMB,  in one year of the law’s existence, Shell Producing Companies in Nigeria awarded $2.4 billion worth of contracts to indigenous companies while Total launched the TOTAL Supplier’s Financing Scheme worth $7.5 billion and made it available through Nigerian banks to bridge the gap between local vendors/suppliers and financial institutions.

Mr Denzil Amagbe Kentebe said, “The profile of the Nigerian oil and gas industry has gone through greater transformation than seen in previous decades; there are more indigenous players in the industry than ever before, a wider pool of skilled Nigerian professionals and indigenous asset ownership has increased steadily as has the domiciliation of manufacturing and fabrication.”

At the Forum in October, Mr Kentebe will be discussing the progress of the Nigerian local content law, which has improved the country’s revenues and grown the business of Nigerian oil companies. According to the NCDMB, by the third quarter of 2014, the proportion of indigenous oil and gas companies in the industry reached 18%, from 5%, and 89.2% of marine vessels were either built in Nigeria or owned by Nigerians and domestic fabrication facilities had increased by 40%. It was also announced that the law had led to $5 billion revenue contribution to the country.

Divestment of onshore assets by the likes of ENI, Chevron and Exxon spurred by the NOGICDA and the incessant pipeline vandalism and oil theft, provided the opportunity for indigenous producers and service providers to rise to emerge as key players in the industry. For instance, in Q2 of 2014, Nigerian firms Taleveras and Aiteo placed the highest bid for Shell’s OML 29 at $2.85 billion. In the same year, Oando Energy Resources completed its landmark acquisition of ConocoPhillips’ onshore and offshore businesses in Nigeria for $1.5 billion.

The Forum participants will also visit the Onne Oil and Gas Free Zone – the only free zone in the world dedicated exclusively to the oil and gas industry -- to see the progress that has been made under the local content law.

The Executive Secretary of the monitoring board said, “I look forward to welcoming all stakeholders across the oil and gas industry for what will be a very productive and enjoyable meeting.”


Other Photos/Videos

Advertisement

Most Popular News

Subscribe Financial Nigeria Magazine
© Copyright 2024 Financial Nigeria International Limited. All Rights Reserved.   | Terms of Service | Privacy | Disclaimers