Oil & Gas
IN keeping with Nigeria’s leadership role in the development of Local Content in Africa, the Nigerian Content Development and Monitoring Board (NCDMB) has concluded a two-day Local Content development experience-sharing session with a delegation from Mozambique’s national oil company, Empresa Nacional de Hidrocarbonetos (ENH).
The engagementwas held on the sidelines of the 8th Sub-Saharan Africa International Petroleum Exhibition & Conference, in Lagos.NCDMB’s delegation was led by the Executive Secretary, Engr. Felix Omatsola Ogbe, while Mozambique’s team was led by the Chairman of Empresa Nacional de Hidrocarbonetos, Mr. Estevao Rafeal Pale.
The experience-sharing session was facilitated by Aberdeen Global Strategies & Solutions, under the leadership of Dr. Mark Osa Igiehon, who consults for ENHMozambique.
In his introductory comments, the Executive Secretaryconveyed NCDMB’s commitment tosupporting African oil-producing nations in developing and implementing local content policies as a strategy for improving indigenous participation and value optimization from hydrocarbons and mineral resources. He lauded the giant strides recorded by Mozambiquein its gas sector and advised against repeating the mistakes made by Nigeria in the early years of its oil and gas industry.
Represented by the Director of Monitoring and Evaluation, NCDMB, Mr. Abdulmalik Halilu, the Executive Secretary explained that every oil and gas-producing nation must choose to either focus on optimizing revenue generation or maximizing in-country value from the activities of the industry.
He stated that the revenue generation option encouragesoil and gas operatorsto seek the cheapest and fastest route to first oil, while theGovernmentcollects maximum revenue in the form of taxes and royalties for development and pays little attention to value addition from industry operations.
He explained that the alternative optionfocuses on maximizing in-country value and promoting the development and use of local capacities. This model obligates operatorsin the industry to consider long-term value,while the Governmenttakes lower revenue in exchange for higher in-country value and paysgreater attention to life-cycle support for operators.
Speaking further, the NCDMB boss listed key parameters that are critical to in-country value addition and growth of the oil and gas sector on a sustainable basis. These factorsare Regulatory Framework, Gap Analysis, Capacity Building, Funding and Incentives, Research and Development, and Access to Market.
He hinted that a Local Content policy backed withappropriate legislation is very fundamental in local content practice, adding that baseline and periodic gap analyses are essential to determine gaps that need to be closed in the areas of skills, facilities and infrastructure.He also stressed the need to developin-country capacities and capabilities and utilise them through oil and gas projects.
17th February, 2024.
C.E.
Tags: NCDMB
