Yemisi Izuora
Indigenous Oil and Gas firms have been observed as key violators of the Nigerian Content Act, which is now challenging implementation of the law in the industry.
The Executive Secretary of the Nigerian Content Development and Monitoring Board, NCDMB, Simbi Wabote who made the observation regretted that the companies unfortunately feel entitled and assume they can get away with non-compliance and also other times they feel to save costs to the detriment of the local economy.
Wabote, stated this in Abuja, while speaking at a breakfast session with key Online publishers, the Guild of Corporate Online Publishers, GOCOP.
He sadly noted that the divestment of producing assets to indigenous players poses significant challenges for the implementation of the Nigerian Oil and Gas Industry Content Development Act.
“The worries are predicated on research findings and our experience in implementing the NOGICD Act in the past 13 years which indicates that indigenous firms, especially the indigenous operating companies are serial violators of the Nigerian Content Act.
“In many instances, international operators tend to comply with the Nigerian Content because it is in their DNA to obey laws or they have to show evidence of compliance to their home offices.
“On the contrary, some many indigenous companies feel entitled and assume they can get away with non-compliance. At other times they want to save costs to the detriment of the local economy.”
According to him, Some of indigenous have also argued that they should be excluded from the implementation of the NOGICD Act since their primary investors are Nigerians, adding, “Some of the common violations by indigenous firms range from executing projects without obtaining prior approvals, non-execution of mandatory Human Capacity Development Initiative (HCDI), Non-Utilization of vendors without approved Nigerian Content Equipment Certificate (NCEC) and Utilization of the services of contractors that are not registered on the Nigerian Oil and Gas Industry Joint Qualification System Portal (NOGIC JQS) and several other violations.
Wabote, further, disclosed that other times, the firms fail to remit their 1 per cent mandatory Nigerian Oil Content Development Fund and engage expatriates without requisite approvals from the Board or even award contracts to foreign firms, even when other Nigerian companies can execute.
He said, “It is very surprising to see local companies undermine and flout the Nigerian Content Act despite being the immediate beneficiaries of the Nigerian Content policy, thereby causing capital flight, loss of jobs, and opportunity for technological development.
“While we commend the indigenous companies that are gearing up to acquire the divested assets, it is pertinent to remind all stakeholders of the industry that the provisions of the Nigerian Content cover all entities and all activities connected to the Nigerian oil and gas industry.
“While we will continue to study the changing ownership dynamics in the industry, the Board will continue to partner with the industry stakeholders to institute regulations that will ensure that the increasing footprints and stakes of indigenous production companies will not lead to a reduction in Nigerian content compliance and participation of Nigerians in the industry.”
He therefore solicited the media to continue its advocacy for Nigerian Content compliance by all stakeholders of the industry, and to remember that the Nigerian Content implementation is a marathon, and we will require all hands on deck to ensure that the benefits of the oil and gas industry is retained maximally in Nigeria.