Yemisi Izuora
A dedicated framework to strengthen local content drive across productive sectors of the economy has been adopted and ready to advance under a fresh approach.
The proposed framework is targeting capacity expansion in industries, manufacturing, sustainability, and global competitiveness as chief focus of the next phase of local content growth is expected to mark a strategic progression beyond preoccupation with indigenous participation and compliance.
The Nigerian Content Development and Monitoring Board (NCDMB), Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), as well as the Nigerian Petroleum Exchange (NIPEX) and the Oil Producers Trade Section (OPTS), comprising all international oil companies are jointly developing the framework to harmonise the grading system for ranking various in-country capacities and capabilities.
The Executive Secretary (ES) of the Nigerian Content Development and Monitoring Board (NCDMB), Engr. Felix Omatsola Ogbe, listed capacity expansion, industrialisation, manufacturing, sustainability, and global competitiveness as chief focus of the next phase of local content growth, marking a strategic progression beyond preoccupation with indigenous participation and compliance.
The earlier phase, corresponding to the first 15 years of implementation of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, 2010, witnessed the phenomenal surge of indigenous participation from marginal levels of less than 5 per cent to 61 per cent, with Nigerians now owners and managers of critical operational assets, providing services, executing projects, and contributing significantly across the oil and gas value chain.
In a keynote address the NCDMB ES, declared that Nigeria’s energy sector now has the capacity to support a vibrant manufacturing ecosystem, and that many local manufacturers are faced with difficulties associated with limited market access, technology gaps, and financing constraints.
He pointed out that addressing the challenges “requires strategic collaboration among regulators, operators, service companies, financial institutions, and manufacturers,” and noted that within the regulatory and business environment of the Nigerian oil and gas industry, there is potential for robust collaboration on the back of the Presidential Directives on Local Content Compliance Requirements.
He explained that under the Harmonisation Road Map drawn up by the oil and gas industry regulatory agencies in concert with the OPTS, the next key action is to commence modification of their various certification portals in readiness for joint industry capacity audits of in-country manufacturers and service providers operating within the oil and gas industry. The outcome of the audit will provide a detailed understanding of existing capabilities, eliminate intermediaries, improve contracting cycle timelines, and ensure direct patronage of established service providers for business sustainability and growth.
The capacity audit, he emphasised, would aid in identifying service providers able to support major capital projects such as the seven Deepwater Projects, while the industry through the Harmonisation Framework has adopted five classes of service providers, which recognizes new entrants into the oil and gas industry that require support in one form or the other.
According to him, “Class 4 and Class 5 of the Framework tagged ‘Emerging Players’ and ‘Essential Vendors’ [respectively] will form the foundation for a robust vendor development programme designed to support the evolution of such service providers into manufacturers and original equipment manufacturers.” He expects the joint industry capacity audit to commence within this third quarter.
“As we look ahead,” he stated, “I believe that the next phase of local content development should be guided by three strategic priorities.” The first of the three is competence, that is, continuous investment in human capital, technology transfer, innovation, and technical excellence to ensure Nigerian companies can deliver at global standards.
For the second priority, namely, capacity expansion, he said, “We must move deliberately towards manufacturing, industrialization, and the development of scalable productive assets. For collaboration, the third priority, he said industry operators, service companies, government agencies, financial institutions, original equipment manufacturers (OEMs) and research institutions must work together to build sustainable industrial ecosystems.
On recent initiatives on capacity building by the Board, the Executive Secretary, highlighted the release of the Nigerian Content Equipment Certificate (NCEC) Application Guidance Notes to provide clarity on requirements to secure approval of applications, the Field Readiness Training Programme, which focuses on top-10 high-demand areas, the Nigerian Content Trainers Registration Certificate (NCTRC), Back-to-the-Creek Initiative, and the Cradle-to-Career Academic Excellence Recognition and Advancement Programme.