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At last, the Local Content Act!

IN 1989, the then Minister of Petroleum Resources, Professor Jibril Aminu, displeased at the virtual lack of Nigerian presence in the upstream sector of the oil industry, invited a number of wealthy Nigerians from all parts of the country to come forward and take oil prospecting licences.

He allocated oil blocks to their companies. Prior to that time, only Dubri Oil was the indigenous company involved in oil mining activities. More than 30 companies benefitted from this gesture. Professor Aminu also forced the oil majors to start awarding contracts for oil services to Nigerian companies.

This was a departure from the trend whereby these foreign companies awarded oil service contracts to companies from their mother countries. With these initiatives, Nigerians were formally introduced to the upper sector of an industry that has earned the nation well over $600 billion dollars since the first oil well was struck at Oloibiri in today’s Bayelsa State in 1958.

However, since that time, governments came and left, choosing to pay only lip service to the need to deepen the involvement of Nigerians in their oil industry. The dominance of the upstream sector by foreigners created ferment in the Niger Delta, as different standards of living became apparent between the indigenes and occupants of the white colonies in their neighbourhood. It was responsible for the kidnapping of expatriates by agitators and militants of the Niger Delta while the conflict in that zone lasted.

The recent signing into law of the Nigerian Oil and Gas Industry Local Content Development Act on Friday, April 23rd 2010 marked another giant leap towards putting the upstream sector more into the hands of Nigerians. According to Senator Lee Maeba, who introduced the Bill at the Senate, there was no law guiding the operations of oil companies before now.

In a nutshell, the Act provides that Nigerian companies must be given primary consideration in the award of oil blocks, oilfield licences, oil lifting licences and any other contract available in the Nigerian oil industry. It also demands that in bidding for any licence, permit or interest or in the industry, an operator must show proof of compliance with the local content Act.

From now on, most activities of the oil industry will not only be carried out in Nigeria but also to a very large extent, in the oil producing communities, ensuring the participation of manpower and expertise in the locality.

According to the Minister of Petroleum Resources, Mrs Diezani Allison Madueke, this initiative is sure to generate over 30,000 jobs within five years. It will also turn the fortunes of Nigeria around from a net importer of petroleum products, such as petrol, diesel, kerosene and others, to a self_sufficient oil producing country as obtains in other OPEC countries such as Iran and Venezuela.

We salute the resourcefulness of Senator Maeba and his colleagues in getting this Act into existence. As a crusader for justice, peace and equity in the Niger Delta, we believe very strongly that this law, when implemented with great commitment, will not only ensure lasting peace and stability in the Niger Delta, but also lead to economic prosperity among its people and other Nigerians in general willing to tap into the benefits of the oil industry.

It will also reduce the incidence of hundreds of young people thronging the premises of the Niger Delta Development Commission (NDDC) because sources of employment in the oil industry will be within easy reach in the oil producing zone and beyond.

We hope the euphoria we are wrapped up in will not be bogged down by our usual poor implementation of laws. In Nigeria , the problem is not the absence of laws and fine ideas. Implementation is the real challenge.


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