It was clear that Nigeria would have to take a decisive action to take control of her oil and gas industry. This eventually came in the form of establishment of the Nigerian Content Development and Monitoring Board (NCDMB) on April 2010, with an Act to govern the board. The sole objective is to drive the process of handing back the Oil and Gas industry to Nigerians. The Act provided for specific quotas and tasks that must be reserved for Nigerians. More importantly, it mandated the Board to grow the ownership and control of the oil/gas industry to as high as 70 per cent within specific period of time.
It is lamentable that prior to the enactment of the Act, out of the about $20 billion spent in the industry annually, less than three per cent remained in the country. The Board is right therefore to aspire to grab at least $14Bn out of the $20Bn that is available every year.
A significant policy initiative so far taken to turn this ugly situation around seems to be the recent establishment of a $200m intervention fund. The fund has provision for not more than eight per cent for contributors and five per cent for community contractors. This is against the prevailing cost of funds in the industry of between 15 and 26 per cent.
Every Executive Secretary that has headed the Board has tried to bring his character and training to bear on the way the NCDMB tries to deliver on its mandate. The present Executive Secretary, Simbi Wabote, barely one year on seat, is seen as doing his level best so far. Wabote is regarded as a tested engineer in the oil and gas industry. He was the first person to head the then newly created Nigerian Content Division in Shell Nigeria. The engineer in the past one year is seen to be pursuing strategies that would stimulate local manufacturing and fabrication culture to meet the provisions of the law setting up the Board. The strongest card he has played so far seems to be the creation of the $200m fund in partnership with the Bank of Industry (BoI).
This is believed to be the only way the second part of the mandate of the Board, helping Nigerians to acquire higher capacities to play in the oil/gas industry, could ever be realized. It is only when Nigerians can have access to cheap and adequate loans as well as ability to fabricate and manufacture most of the equipment deployable in the industry and acquire sensitive skills and competences to lead operations that they can bid for real jobs that would hand higher quotas to them.
It is therefore very important not only to commend these bold and strategic initiatives but to appeal to all stakeholders, both insiders and external stakeholders, to, for once, treat the rules governing the fund with utmost respect. There must not be insider-abuses or external influences. The loans must be applied strictly for purpose. Besides, there must be measurable milestones and transparent updates on what has been achieved. There is need to have official inventory of local content capabilities and gaps to be closed, and this must be reviewed every year. The rules of assessing inventions and fabrications must be clear and strictly adhered to, so that those disqualified would have no reason to blame anybody.
Meanwhile, the Board deserves huge cooperation from all stakeholders especially the Government and IOCs to enable them guide and guard this sensitive journey to an oil/gas industry operated by Nigerians for Nigerians.
Tom Briggs
