The Nigerian economy would save about N280.8billion (about $1.8billion) from the operations of indigenous vessels contracted to International Oil Companies (IOCs) operating in the country by June 2012, says the Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Ernest Nwapa.

According to Mr. Nwapa, about 40 vessels owned by Nigerians are to replace those contracted by foreign-owned vessels in line with the marine vessels and rig ownership strategies adopted by the Board pursuant to the provisions of the Nigerian Content development law in the oil and gas industry.

The Executive Secretary announced that the IOCs have since given their commitments to replace foreign vessels in their operations in line with the Board’s definition under Category 2 vessels, which include anchor handling tugs (AHT), dynamic positioning platform supply vessels (DP PSV) and line handling tugs (LHT).

Similarly, vessels under Category 1 include crew supply vessels, mooring launch vessels, shallow draft vessels, fast supply/intervention vessels and security vessels.

Already, he said almost all the vessels working under Category 1 in the industry are not only owned by Nigerians, but  are being manufactured locally, while a consortium of investors are finalizing plans to commence the manufacturing of 40 new meter vessels in Nigerdock Snake Island facility from 2013.

“Before the enactment of the Nigerian Content Act, foreign-owned vessels and rig operators dominated the oil and gas sector, resulting in about $3billion capital flight,” Mr. Nwapa said. “Today, the situation is changing. From our calculation, in 2012, we will be retaining over $1.8billion just by ensuring that these vessels are owned by Nigerians. In the past, they were getting spot contracts. But nobody can invest without a long term contract.”

He described the local content policy as a tool that would stimulate industrialization of the country, create productive employment and bring back the jobs to Nigerians, pointing out that by mere establishment of pipe mills, dockyards and other facilities as well as patronizing them, indigenes of oil bearing communities would be integrated into the industry.

Mr. Nwapa explained that the promotion of equipment components manufacturing was top on the priority list of the board, considering the potentials to employ significant population of the people, adding that the Board would always insist that the capacities of Nigerian yards and facilities be exhausted before contracts are taken abroad.

The executive secretary, who maintained that patronizing Nigerian facilities would help attract foreign investors and create practical learning opportunities for students, commended the plan by Nigeria Liquefied and Natural Gas (NLNG) to set up a dry docking facility in-country to service the company’s 24 tankers managed by BGT.

He clarified that efforts to increase Nigeria’s participation in the industry was not intended to drive out foreigners from the economy as the high tech areas are still open for foreign and indigenous players, adding that all IOCs in Nigeria had placed jobs with SCC Pipe Mill in Abuja, while the NNPC is in the process of doing so, to help keep the job of its employees.

“There is need to set up more pipe mills in the country to ensure successful execution of the Gas Master Plan and replacement of old pipes, expected to utilize over 2,500 kilometers of pipes in the next five years,” he said. “Apart from the proposal by a company to build a mill in Calabar and the Yulong Pipe Mill to be sited in Yenagoa, there is also a need to site a mill in the northern part of the country for use in the Gas Master Plan project.”