Oil companies need to manufacture some of their equipment locally, the local content boss said.
For Nigerians and the local economy to benefit from the multi-billion dollar investments expected after the pending passage of the Petroleum Industry Bill (PIB), Nigerians must prepare themselves by embracing the development of the Nigerian Content policy, the Executive Secretary, Nigerian Content Development and Monitoring Board, Ernest Nwapa, said.
Mr. Nwapa, who was speaking on Tuesday at the panel session organized by the Petroleum Technology Association of Nigeria (PETAN) at the just concluded Offshore Technology Conference in Houston Texas, United States, said there was an urgent need to expand discussions around the proposed legislation beyond the fiscal terms.
Warning that failure to sufficiently domicile the service and manufacturing ends of industry operations, he said investments that would flow into the country may be diverted abroad through overseas procurement of equipment used for operations and remuneration of expatriate personnel that would be deployed to work on the projects.
“It is expected that when PIB is passed, it would result in massive investment flows, and those investments will yield revenue for Nigeria. But what we are looking for is a kind of impact that can give us employment on top of the revenue scale,” Mr. Nwapa said.
“That type of impact would only come from the investments that result in domiciliation. It is a good thing we have had a three-years head-start in the implementation of the Local Content Act, which has enabled us create some capacities in Nigeria such that as the PIB is being passed and investments are coming, we would then have jobs arising from the investments being executed locally.”
The Executive Secretary also canvassed for industry support for the Board’s initiatives, especially the Nigerian Oil and Gas Industrial Park Scheme and the establishment of a new pipe mill to support the existing SCC Mill in Abuja, pointing out that when the initiatives are successful, Nigerians would reap immense benefits from the PIB, as more industry activities would be domiciled.
He underlined the importance of getting the investments in-country, pointing out that though the country needs to increase its revenue intake from oil production, the real endgame for it is to ensure that when it is getting revenues, there are Nigerians to work.
“Government agencies can only employ a few thousands, but the real employment can come from commercial activities that would arise from our preparedness to expand operations,” he said.
On the relationship between the Nigerian Content Act and the PIB, the Executive Secretary said there was an urgent need for the big multi-nationals and other companies operating in Nigeria to encourage the establishment of facilities where components of industry equipment could be manufactured locally, adding that local manufacturing holds the key to creating jobs in the oil and gas industry.
“The responsibility of the Nigeria Content Development and Monitoring Board is to work with the industry to drive the establishment of these manufacturing facilities and that is why the government is pushing for the launching of the Nigerian Oil and Gas Industrial Park Scheme equipment used in the industry. The big manufacturers would come to the park and select a local partner that would manufacture their components,” he said.
He assured that the Board would use the Nigerian Content Fund to create industrial parks close to the oil fields and get original equipment manufacturers to mentor small and medium scale enterprises to manufacture components of their equipment.
At the PETAN OTC panel session, which had its theme as “Post PIB Regime: Challenges and Opportunities for Investment in the Nigerian Oil and Gas industry”, stakeholders agreed on the need to ensure that the PIB, which is presently on the floor of the National Assembly, is passed speedily.
Support PREMIUM TIMES' journalism of integrity and credibility
Good journalism costs a lot of money. Yet only good journalism can ensure the possibility of a good society, an accountable democracy, and a transparent government.
For continued free access to the best investigative journalism in the country we ask you to consider making a modest support to this noble endeavour.
By contributing to PREMIUM TIMES, you are helping to sustain a journalism of relevance and ensuring it remains free and available to all.
TEXT AD: To advertise here . Call Willie +2347088095401...