Local content Improves Nigeria’s vessel fleet growth by 65%

Local content Improves Nigeria’s vessel fleet growth by 65%
Crude Oil Vessel

Strong indications emerged that Nigeria may have began to reap the benefits of the Local Contend regime, which increased indigenous participation in the oil and gas industry, as indigenous fleet grows by over 65 per cent in four years.

The Federal Government had sequel to the passage of the Coastal and Inland Shipping Cabotage Act, 2003, which provides that vessels to be used in the coastal and inland trade must be built in Nigeria, owned and crewed in Nigeria also passed the Nigerian Content Act, 2010.

In addition to the passage of the Nigerian Content Act, which seeks to promote indigenous participation in oil and gas activities, the government also created the Nigerian Content Development and Monitoring Board NCDMB, located in Yenogoa, Bayelsa to enhance the enforcement of the legislation.

The creation of this all-important agency has also led to proper enforcement of the legislation, which has in turn led to creation of jobs for Nigerians, thereby reducing the prevalence of youth unemployment in the country.

However, available statistics shows that about four years ago when the Act became effective, Nigerian-owned vessels engaged in oil and gas activities constituted only about 20 per cent, which has increased too over 85 per cent, thanks to the regime.

It was also gathered that passage of the Act has attracted over $1.7 billion private investment over the four year period. It was gathered that as at thin June, 2014, Niger dock Limited has attracted over $230m direct investment while the Snake Island Free Zone has attracted over $1bn over a period of three years.

It was also gathered the newly completed Kaztec Engineering Limited, which is a creation of the local content regime has invested over $1m with the potential to create over 9, 000 jobs even as Eko Support Oil and Gas Logistics Base, built by the Nigerian Ports Authority in Apapa Port area also in Lagos was completed towards the end of last year at the cost of $124m.

Also, Digisteel Integrated Services Limited located on Ogogoro Island has commenced the development of a $100 facility along the Niger dock axis.

Similarly, the Lagos Deep Offshore Logistic Base LADOL, which is the location of Samsung Heavy Industries Floating Production Storage and Offloading FPSO, has already invested over $450m in the last six years, all of which lay credence to the success of the Nigerian Content Act 2010 implementation.

Experts are also optimistic that this facility over the next few years will create no fewer than 50, 000 direct and indirect jobs “The importance of attracting continued investment in the oil and gas sector was recently highlighted when Nigeria’s oil sector’s contribution to the Gross Domestic Product, GDP, was ranked the lowest among the members of Organization of Petroleum Exporting Countries, OPEC”, an operator said.

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