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FG should support indigenous firms financially-Iwueze

By Yemie Adeoye
Sir Enoch  Iwueze, chief executive officer, Air Sea Freighters Limited speaks on importance of participation in training programmes by indigenous operators in the Nigerian oil and gas industry. He spoke with Vanguard’s Yemie Adeoye during the Offshore Technology Conference, OTC in Houston, Texas, USA, recently.

What in your vie


w would participating companies in this conference benefit as a result of their massive attendance, especially Nigerian companies?

The Offshore Technology Conference, OTC is a kind of trade fair where international manufacturers exhibit their products for services particularly drilling of oil and gas. We as service providers in the Nigerian oil and gas industry are participating at the conference to partner with them. This is because none of these items can be exported without shipping, without air freighting, without rail or road transport. And that is why we are here.

Indeed, the participation of Nigerian companies at this year’s edition coordinated by the Petroleum Technology Association of Nigeria is excellent. It is really nice and rewarding for me to be part of the delegation. In order to build on the success recorded in my company’s participation annually, we always ensure that we make provision for the cost of financing our participation when preparing our budget for the year and this is the sixth year that I have been participating in OTC consecutively. And it has been very rewarding because each time I come here, I always add two or three customers to the list of our clientele.

What are the core objectives of this conference especially as lots of companies operating in Nigeria now find pleasure in attending these foreign conferences?

Contrary to the opinion of some people that OTC is a jamboree, I will continue to disagree with them because if you have adequate plans and you have  a good business with the intention to develop and grow the business relating to services in the oil and gas industry, I can assure you that OTC is the right place to come. Nobody wants to waste his time and money for nothing.

Everybody comes to the OTC with something in mind to gain. It is the right place for a young entrepreneur to meet manufacturers and get attention. It is also the right environment to hold meetings that will have positive impact on a particular line of business.

That is why you see most of the chief executive officers moving from one stand to the other. What do you think they are doing? They are appreciating achievements of these manufacturers, they are making contacts and they are listening to presentations that will help them to have update on what they are doing in the oil and gas industry. There are intentions and positive gains.

Talking about myself, I have something to gain and that is why I am attending the conference again. Equally, others you see at this conference have one or two things to gain.

And as you know, the sector is dynamic, if you fail to move forward when others are moving forward, by the time you invest in a particular technology, you would be surprised that by the time you finish the execution, it has already become an obsolete item. Hence, the patronage will be very low and the return on investment will equally be zero.

What has been the value added as a result of the conference, or is it another talk shop where all we do is listen without implementing?

This conference is adding value to businesses in the global oil and gas industry. Apparently, a lot of equipment on display here were not available last year and the previous year.

There have been a lot of innovative ideas in the system. Really, you know that  drilling requires a lot of  equipment and some of these are new as a result of advancement in technology. The innovations in technological advancement are based on combination  of ideas. These new equipment are performing functions, adding extra value to operations of companies in the oil and gas industry.  Obviously, members of PETAN will improve their technological knowledge  in this direction and no doubt it will add value to their operations in Nigeria.

What is your assesment of the Nigerian Content Policy of the Federal Governmet?
We need partnership to build capacity and when we have these companies investing in research and development of new technology in various areas as partners; it will help us to be able to improve participation in execution of contracts in Nigeria. If we fail to acquire modern equipment and facilities, it will be difficult to compete for jobs because of the advancement  of foreign companies.

When many Nigerian companies are having new ideas, it will also help foreign companies operating in Nigeria to reduce the number of their expatriate staff and replace them with Nigerians who can do the same job effectively. This is more important for us as a nation, because unemployment will reduce and criminal activities will also reduce.
What has been the level of compliance so far?

Since the introduction of the Nigerian Content Policy in 2005, it is clear that more Nigerian companies are increasingly getting more jobs through creation of awareness. Equally, the number of expatriates have been reducing and that is how the percentage of  earnings  from the oil and gas industry coming to the pockets of Nigerians will  continue to increase.

The Nigerian National Petroleum Corporation, NNPC defines Nigerian Content as the quantum of composite value added or created in the Nigerian economy through the utilisation of Nigerian human and material resources for the provision of goods and services to the petroleum industry within acceptable quality, health, safety and environment standards in order to stimulate the development of indigenous capabilities.

The introduction of the policy was as a result of the low level of contribution to the nation’s gross domestic product, GDP by the oil and gas industry despite an average of $10 billion investment per annum. This is evident from the over 80 per cent of work value carried out abroad.

The achievement of the directives in the Nigerian content policy cannot be automatic, it must be a gradual process and that is the only reason for it to bring more benefits to the government and Nigerians. This is important so that multinational oil firms operating in the upstream sub-sector will not feel bad about the implementation of the policy. The foreign oil firms must be carried along in the implementation of the Nigerian Content policy.

For instance, investment in the acquisition of crude oil tankers and gas tankers is highly capital intensive, no Nigerian company has it at the moment. Even if they come together to get one or two crude oil tankers,  that will not even meet high percentage of the requirement.

This situation will continue to remain like this until when Nigerian companies continue to become involved in the business gradually. It is not easy. However, when we talk of local tankers, here Nigerians are getting involved but the oceangoing tankers require enormous investment. I can say that Nigerian companies are increasingly getting a fair share of jobs in the upstream sub-sector through the joint venture (JV) operators who are mainly foreign oil firms and I believe it will get better if we can sustain the policy.
What in your view is the way forward sir?

We have a lot of work to do in the implementation of the Nigerian Content Policy. We have to partner with the multinational oil firms, we have to let them understand that we can do what foreign maritime firms are doing in the country. It is highly capital- intensive.

I believe especially in what the Federal Government is doing to promote the participation of indigenous  companies especially in terms of cabotage law in the maritime industry. The Federal Government has to come to the aid of Nigerian companies operating in the industry in terms of financial resources which will help to improve the system. The Federal Government should support indigenous firms financially. Again, I believe it is a gradual process and we shall get there.


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