Breaking News
Translate

NCDMB moves against companies defaulting in local content fund – As fund hits $600m

By Sebastine Obasi

Facts have emerged that many indigenous companies in the oil and gas sector are not contributing to the Nigerian Content Fund, NCF, meant to address financial and liquidity challenges of Nigerian companies operating within the nation’s oil and gas industry as enshrined in the Nigerian Content Development Fund law.

This is happening as the fund is said to have reached $600 million, as at October, 2016. The Executive Secretary of the Nigerian Content Development and Monitoring Board, NCDMB, Mr. Simbi Wabote, who stated this in Abuja also said that plans are underway to make those companies comply with the requirements of the law.

He said, “This is important. While some people worry about the companies that have contributed, there are some other Nigerians companies that are not meeting up the contribution as enshrined in the law. However, we will look at the strategies that will make them comply with the provisions of the Act.

“Some of might be out of ignorance. Some of may be out of not understanding the implications of not contributing and the mechanism to do those contributions. We are looking at that process and I can assure you that within the shortest possible time, we will reach all those companies that are not contributing to the fund and make them comply with the laws of the land.

Having said that it is also important to give them comfort that it will be judiciously utilised for what it is meant.”  Giving insight into the accessibility of the fund, Wabote said that contrary to the concern of stakeholders that they have been shut out of the fund, six Nigerian companies have benefitted.

“It bothers the mind of key stakeholders. When you look at the Nigerian Content Fund that they started contributing since 2010, when the Act was enacted. I must say that the fund has grown over the years. Probably, we have an approximate figure of $600 million in the fund.

As far as I am aware, the fund has benefitted about six Nigeria companies that have tapped into that fund for capacity development, but I must say it is not directly giving money to those Nigerian contractors. It is about guaranteeing some of the loans they got from the banks. We are not a funding institution. We guarantee the loans they take from the banks,” he said.

Though he did not mention the names of the beneficiary companies, he also admitted that that not much has been deployed for capacity development.

According to him, “Not much has been expended from that fund for capacity development.  Part of the strategy of this new Board is to come out with a very transparent process with which genuine Nigerian contractors in the oil and gas sector will have access to the fund.

‘‘Most of the contributors are asking questions about the fund and we are not oblivious of this fact. We will make that position very transparent as soon as possible. One important aspect is the establishment of the Governing Council of the Nigerian Content Monitoring Board which was inaugurated on the November 18 by President Muhammadu Buhari.

That will bring corporate governance principles in the management of the activities of NCDMB and also support us in terms of the strategy we need to deploy in the area of fund management.”


Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.