Hurdles To Achieving Local Content Objectives In Oil, Gas Sector 


Hurdles To Achieving Local Content Objectives In Oil, Gas Sector
Ernest Nwapa (The Executive Secretary Nigerian Content Development Monitoring Board)

Signing into law of the Nigerian Content Act in year 2010 was one of the best things to have happened to Nigeria’s oil and gas sector. In fact, the law has exposed Nigeria and Nigerians to many opportunities that abound within the shores of the country and proved to the international community that the nation and its people are highly endowed with human and material resources.

However, just like the every good things that happen to any mortal, their are numerous factors that have remained as clog in the wheels of the local content drive, which the indigenous firms and the regulatory agency have continued to battle headlong.

Stakeholders in the industry and the indigenous operators have raised concerns about the critical issues of political will and the cankerworm of corruption which are identified as setback to the realisation of the objectives of the Nigerian Content programme of the Federal Government.

The Executive Secretary Nigerian Content Development Monitoring Board, Ernest Nwapa said at the Offshore Technology Conference in Huston, Texas, that policies of some government agencies are spelling gloomy future for the local content agenda.   

Nwapa said some of the policies relating to importation of raw materials that would spur the capacity of indigenous firms are too harsh for survival of the Nigerian Content programme.

Besides, he also sounded a note of warning to some operators and stakeholders that engaged in sharp practices to boycott the Nigerian content law, adding the board has been well positioned to sanction any erring entity.

The President of an indigenous engineering service firm, Divcon Group Inc, Andy Ikhehide, believed that since the passing into law of the Nigerian content Act, a lot have changed in the technological development and empowerment of Nigerians in various sectors, “but we are not yet where we ought to be”, although he added that “we are no longer where we used to be.”

Ikhehide, who recently celebrated his company’s 10 years anniversary, said: “Divcon Group is a key stakeholder and a rising star in the horizon of the local content development in the Nigerian oil and gas industry. We have come to recognize that the concept of free technology transfer is fallacy even though many would not agree. No one, no matter how you think he likes you would deliberately transfer his technology to you for free of charge. You can buy technology, you can even steal technology as in the cases of Japan, china, india, Singapore to mention but a few. 

“This stealing of technology is what is referred to as reverse engineering. Japan for example was down to nothing after the world war but the travelled the path of reverse engineering in a story we are familiar with. You must take deliberate steps that must cost you something.

“These deliberate steps involve acquisition of the required intelligence to adopt the evolutionary strategy of innovation coupled with revolutionary approach of creativity.

“We believe that if Nigeria is to be technology giant in Africa, we must change both the way we think and our consumer mentality to that which harvests creativity, innovation and excellence.

“We must deliberately change the limit of knowledge to update the facts of what we know because exploits in life is predicated on the limit of your knowledge of God, who you are and your natural endowments and potential, he said.

According to him, great strive and progress have been made by creating a condicive environment for Nigerian firms to thrive, but the nation need to utilise its human resource capital optimally.

“Nigerians are among the best brains in the world. Nigerians are making positive waves of excellence, creativity and innovation in their chosen endeavors in USA, Europe, Asia and around the world. Why can’t we create the enabling environment for such great minds to make great positive impacts in their home country Nigeria? Why can’t we convert our brain drain to brain gain.

“Political leaders must see themselves as Nigerians first before the see themselves as politicians so that National interest should be made to prevail over personal, sectional and partisan considerations, he said.

Ikhehide however, appealed to the 7th session of the National Assembly to looks at the expected gains of the petroleum industry bill (PIB) and pass it into law before the end of the end of the year 2014. 

“In doing so, they will be carving a legacy for themselves as a group of patriotic Nigerians who choose to do what is right to the nation at such time of need,” he said.

He continued: “We must confront the security challenges we have across the nation on four strategic fronts namely spiritual, technology, military and diplomatic. Extra ordinary problem requires extra ordinary solutions. We cannot continue to give reason why we are failing we must start looking for reasons why we must not fail. 

“The failure of the Nigerian state portends catastrophic humanitarian disaster for the whole of Africa and we must not allow this to happen. This not just the responsibility of a Government alone, it is a collective responsibility to deploy our Spiritual, technological, military and diplomatic capabilities to fight terrorism in Nigeria.

“We must realize that the world is changing so fast and knowledge is increasing so rapidly to the point that the more you know, the more you know that you do not know. We cannot confront the challenges of today with the knowledge of yesterday. As a nation, there is a huge gap between what we teach in the schools and the knowledge required to make impart outside the school. We need to completely overhaul our educational curriculum to serve, not just this generation but the next generation,” he said.

The Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, has recently expressed confidence that Nigerian Content implementation will “lend itself in a critical way to the growth of the nation’s economy and development of the citizenry in terms of knowledge, capacity building and employment generation.”

The minister further explained that over $200m will be invested in the pilot pipe mill project, which is expected to be completed before the end of 2015. Noting that civil works and development of jetty have started, she said over 500 direct jobs and 10,000 indirect jobs will be created by the project while some community youths will be trained abroad to work in the plant.

The Head, Marginal field department, NCDMB, Rotimi Olagbaye, said localisation of equipment used in the oil, gas industry holds to key to employment opportunities and reduce the capital flight in the country. 

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