JDZ Nigeria-Sao Tome e Principe

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Nigeria: 'FG, Multinationals Committed to Local Content'

Goerge Okojie

29 August 2011

The Minister of Petroleum Resources, Mrs. Diezani Allison Madueke has reiterated federal government's commitment towards the building of local content and capacity in Nigeria's oil and gas industry.

She gave the assurance at a conference organised by the National Association of Energy Correspondents (NEAC) held at the Eko Hotels and Suits in Lagos .

In her address with the theme: "The Impact of Petroleum Industry Bill on Nigerian Content Development," the minister said it was part of efforts to create an enabling environment for indigenes to thrive in the sector, adding that the country recently pressed for the signing of the Nigerian Content Act which came into effect in April 2010.

Madueke who was represented at the ceremony by the executive secretary of Nigeria Content Development and Monitoring Board (NADMB), Earnest Nwapa, lamented that after many years of transactions in the country which amounted to huge sums of money, contractors and multinational did not have solid footprint in the country.

"Instead the trend has been to look to foreign countries for procurement of equipment, spare parts and technology in support of their operations in Nigeria and the Gulf of Guinea region. The major operators have not helped matters by reliance on the importation of goods and services from abroad without making provisions to develop sustainable capabilities within Nigeria that would support life cycle operations in the country.


" The cumulative effects of operating this model for so long is that in an industry that currently spends an average sum of $20 billion per annum, less than $2 billion is retained in the national economy and over $300 billion has been lost to capital flight in this way," the minister said.

She explained that the persistent of the practice has resulted in the export of millions of employment opportunities, opportunities for training , knowledge and technology transfer opportunities for investment in facilities and infrastructure to support industry operations within the country.

She said that the ministry has set some targets for specific work items to be executed in the country , adding that a monitoring system has been put in place to ensure compliance.

"This denies indigenes of Nigeria the opportunity to participate in the most critical aspect of their national development activity . The challenge therefore is for government to create an enabling environment that allows capital to flow inwards and get retained for economic growth and development," she added.

When signed the she hinted that the Nigerian Content Act has provision of guarantees for indigenous participation and integration of oil producing communities into mainstreams industry activity, adding that development of and utilization of local capacity through promotion of education and training would be accorded priority.

The minister emphasized that the Nigerian Content Act is not intended to indigenize the industry assets of investors in the country's economy, pointing out that it sets out provision that guarantees that investment made in the facilities within the country are utilized , while ensuring the rights of the investors are protected under the law.

Also speaking the General Management Policy , Government and Public Affairs , Chevron Nigeria Limited Engineer Femi Odumabo said the company was totally committed to the growth of local entrepreneur in line with its determination to encourage local content in the industry,


" Indeed , Chevron's investment in people is very significant . We currently provide thousands of jobs in Nigeria, with a reasonable number of employees being direct Chevron employees. More so greater percentage of these employees were Nigerians.

" We have deep interest in promoting this subject and have recorded significant landmark and accomplishment in Nigeria. Our various major capital projects represents the industry's largest support of Nigeria content with thousands of major components for the projects fabricated by local firms in Nigeria," he said.

He said the company's commitment in this regard earned it the covetous NOG award of excellence in the country in the year 2007.

Odumagbo said a massive amount of invest is currently needed to meet this growing demand for energy to sustain economy growth in the country , saying the company is contributing its bit by investing massively in alternative energy .

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