By Anthony Uche
Over one year after the Nigerian Oil & Gas Industry Content Development (NOGICD) Act was signed, the challenges of its implementation have come to the fore. Incidentally, not enough focus has gone towards these specific challenges. The industry’s main players have interacted with the Nigerian Content Development and Monitoring Board (NCDMB) mostly on the contracting side, especially with respect to Nigerian ownership. NCDMB also issued several guidelines related to workshop nationalization and technology transfer. The implementing community is eager to talk, not only about the Nigerian ownership requirements, but also to exchange insight about the successes and drawbacks of implementation and how to build on progress so far.” With these charge, Ebi Omatsola , Group Vice Chairman, Conoil Plc, set the ball rolling at the management session of the 29th Annual International Conference and Exhibition of the Nigerian Association of Petroleum Explorationists (NAPE) with the theme, NOGICD Act: Implementation Challenges for the Oil & Gas Industry.
Moderating the session Nosa Omorodion, General Manager, National Content Development, Schlumberger Nigeria and Gulf of Guinea countries, wondered why Nigeria with a reserve of 38 billion barrels, can only produce 2.2 million barrels daily. “There is no question that we can do much better, therefore increased local participation is not out of place.” He said
To the NCDMB, it intends to achieve a target of 65% local content in the oil and gas industry in the next 10 years; 5 years from now, its aim is for 50% of the rigs used in the country to be indigenously owned; By 2020, Nigeria should be able to achieve 150,000 tonnes of fabrication works, and accomplish 6 million project engineering man hours. With all these targets to be met, the commitment to local content that the NCDMB is insisting on is unprecedented and to build capacity on how to drive this has informed the NCDMB’s engagement with industry stakeholders, which includes both the big and small players. Ernest Nwapa, Executive Secretary, NCDMB, in his keynote address made it known that Nigeria’s “footprints” presently are based on where the country gets her products and services from and the reverse is the case for other countries that put their footprints based on where they supply their products and services to. “To this end NCDMB’s goal over the next 10 years would be to promote doing more of the services in Nigeria and achieving 65% of local content in Nigeria” Nwapa said. He noted that the board enjoys the full support of the Federal Government in achieving these targets and the main trust in achieving these objectives is to maximize the utilization of Nigerian made goods, to use the country’s human resources to its highest potential. Also being emphasized is increased collaboration between government and the private sector, and the importance of linking the oil and gas industry with other sectors of the economy.
He acknowledged that community participation is vital as it is a veritable means of access. Noting that the country runs the risk of experiencing intermittent shutdowns of the industry if it ignores the host communities. Stressing that the Act can guild the industrialization of the country, bearing in mind Jonathan’s gas revolution, as the oil and gas industry is the most organized sector in the country. “The vision of NCDMB is to be the tool for the industrialization of Nigeria, and this we intend to achieve by encouraging indigenous ownership of assets in the oil and gas industry.” He said.
On improvement made so far since the enactment of the NOGICD Act in March 2010, he said, “Using the provisions of the Act and by direct intervention of the NCDMB board, over 500 engineers and geoscientists have been put in the industry. We have been able to enforce direct utilization of some of the country’s manpower capacity. Pre-NOGICD Act, it was a million man-hours, but today we have 2.2 million engineering man-hours, and with improved capacity this will improve to a 6 million man hours target”. He identified local content growth in the fabrication sector, noting that the Brass Liquefied Natural Gas (LNG) project stands as one of the success stories.
In terms of data capturing and monitoring compliance of local content, Nwapa stressed that the NCDMB has a robust technological platform called the NOGIC Joint Qualification System (JQS). All the requirements of the Act are captured in the NOGIC JQS, and it is used as a tool for monitoring compliance. He noted that the Act gives impetus for indigenous service providers to step up their game as they are building capacities by working for the International Oil Companies (IOCs). He threw the challenge to the private sector to collaborate with government to help build capacity for the industry, and that the board has noted the areas that need capacity improvement
On human capacity issues, Cyril Odu, Vice Chairman, Exxon Mobil, said his company has structures that drive human capacity, which includes training, performance evaluation and enhancement, and clear transparent recruitment processes. “One of the ways we have helped build capacity is the setting up of a vocational training school in Eket, Akwa Ibom state, where technicians are trained. Over the last 16 years, 613 technicians have graduated from the scheme, and 80% of those have been employed by Mobil” Odu remarked.
Cyril Odu called on industry stakeholders to work together to ensure the smooth and successful implementation of the Act, most importantly, to focus on building a global competitive workforce in Nigeria, which will be the key driving force for the industrialization of the country. “With all the machines and equipment and without the right people in place, there cannot be a right sustaining Nigerian Content development” He said.
On the challenges faced by indigenous service providers, Orji Nwosu, General Manager, Fabrication and EPC, Dorman Long, said that despite efforts made by his company to acquire the needed certification for its fabrication equipments in order to build capacity for the industry, it still faces the problem of under-utilization of its facilities by Oil & Gas companies in the country.
He insisted that massive fabrication works can be done in the country, and the capacity is there to do it. He noted that people are not patient to understand what it takes to build the Nigerian content capacity.
Igo Weli, General Manger, Nigerian Content Development, Shell, in his presentation, “Nigerian Content Development: a marathon not a Sprint”, said that the country seems to have made an encouraging start since the enactment of the Act and the focus should now be on building on the progress made so far.
The management session was one of the main events at the NAPE conference.