Leveraging local content capacity to advance Nigeria’s oil, gas sector
With exploration, fabrication and refining activities growing in the oil and gas industry, the issue of skill-gap in the sector has militated against increased application of local content to achieve desire growth.
To this end, Industry watchers have insisted that the ongoing clamour for the growth of local content is the best approach at this period of recession, adding that Nigeria need to be able to leverage on the collaborative benefit that adequate local skills in the country can offer the oil and gas industry. By so doing, it will reduce cost and promote local content.
“Oil and gas industry is a technological driven industry. It doesn’t employ a lot of people. But the issue is we could leverage on the opportunity to be able to add value and create jobs”. They added.
Assessing the local content act
Aina Blankson in a recent article reported that Local Content represents a quantum of composite value added or created in the Nigerian economy by a systematic development of capacity and capabilities through the deliberate utilisation of Nigerian human, material resources and services in the Nigerian oil and gas industry.
According to the report, the Nigerian content simply focuses on the promotion of value addition in Nigeria through the utilisation of local raw materials, products and services in order to stimulate growth of indigenous capacity. The Act promotes a framework that guarantees active participation of Nigerians in the oil and gas industry without compromising standards.
To this end, the Act requires that Nigerian indigenous operators be given first consideration when contracts are awarded for oil blocks, licenses and all projects; that service provided and goods manufactured in Nigeria be given priority or preference and finally qualified Nigerians are considered first for employment and training.
Analysts are of the opinions that the local content act has really being critical to the development of our economy. Adding the Act would be instrumental going forward in making sure that companies that still hope to take advantage and exploit Nigeria find it much harder and hopefully impossible to do so.
Amy Jadesimi, Managing Director of Lagos Deep Offshore Logistics base (LADOL), while commenting on the issues around local content act said the idea was very timely and remains important to the development of not just the oil and gas industry, but capacity across other sectors of the economy.
Jadesimi observed that through the inauguration of the board of Nigerian Content Development and Monitoring Board (NCDMB) it would enforce the local content laws and that is obviously positive.
According to her, “Enforcement of the local content act would encourage Nigerians to invest their money here in building, investing in asset and human capital development. More importantly people should understand that local content should include the whole of Nigeria”.
“Local content advocacy is about creating jobs and opportunities across the country and I think that is the only way we can be able to overcome the resource curse and get into an era of positive growth which would tackle poverty and inequality in our country”.
She insist that local content is absolutely critical stressing that with the example of Ladol, it would provide the needed incentive to international and local companies to work collaboratively to create capacity and to really generate businesses that provide sustainable jobs over the next 100 years.
Advancing Nigeria’s oil and gas sector the local content option
Industry watchers observe that a unique advantage any country or organisation has over its competitors is a well-developed, skilled, dedicated, committed and motivated human capital.
They pointed out that in an increasingly global and competitive economy, principally driven by technology, the ability to articulate and execute a robust programme for the practical training and development of oil and gas professional will remain critical success factor for the sector to succeed in Nigeria”.
Maikanti Kacalla Baru, Group Managing Director of the NNPC at a recent event was quoted to have said that complying with the nation’s local content laws would further strengthen in-country value addition in the oil and gas industry.
Baru said the determination of NNPC to maximise participation of Nigerians in its projects and domicile project activities in-country is a step in the right direction
He is deeply concerned with the low level of Nigerian Content in-country, despite the nation’s almost fifty (50) years of oil industry experience.
The NNPC boss was quick to call for a fresh approach to domesticating oil and gas industry spend through the establishment of the Nigerian Content Division (NCD) with the aim of implementing key national content initiatives,
To him, some of these key local content initiatives such as the promotion of local manufacturing of steel plates and pipes as well as the development of engineering design expertise among Nigerian engineers would further strengthen capacity in the sector.
“Nigerian Content Policy represents a catalyst for the nation’s industrialisation because the policy has been tested as a result of the current volatility in oil prices witnessed globally”.
There is a need for a paradigm shift in accordance with a new operating philosophy that would lay emphasis on in-country manufacturing, job creation, skills and technology development, capital retention, research and development as well as fostering sectoral linkages with other critical sectors of the nation’s economy”.
“Nigeria needs to claw back most fabrication work and other services in the industry from foreign yards thereby increasing the contribution of the industry to the nation’s GDP. It is our goal to achieve much more,” he added.
Omowumi Iledare, a Professor and director Emerald Energy Institute, University of Port Harcourt, Nigeria while speaking at a Conference organised by Oil and Gas Trainers’ Association of Nigeria (OGTAN) in Lagos recently observe that the oil and gas industry has contributed tremendously to the overall growth of the Nigerian economy.
Iledare disclosed that the upward expansion trend in the industry has created demand for a wide array of jobs ranging from professionals such as geologists and engineers to skilled blue collar jobs such as technicians, welders and electricians.
He however maintains that the imperative for the growth and survival of the oil and gas sector in the country should be anchored on the enforcement of the national content mandate which would require technicians of all shades and grades.
According to him, “To meet this growing demand in the oil and gas industry for skilled technical workers, there is a huge need for the oil companies to patronise technical colleges to meet this demand”.
He said that by growing investment in technical education, there will be reduction in capital flight by the decrease in the use of expatriate staff as technician stressing that this will lead to increase in the rate of employment of youth, increase in the economic growth regionally which will in turn increase the wealth of Nigeria within the her border and grow the economy faster.
Olayinka Agboola, an industry expert from Petroleum Technology Development Fund (PTDF) is of the view that the nation’s development aspirations can largely be actualised through enforcement in the local content adding that this would bridge the gaps noticed in the sector and accelerate the drive towards a sustainable development in Nigeria’s oil and gas space.
KELECHI EWUZIE