Energy

March 27, 2012

NCDMB clarifies price disparity between Nigerian, foreign oil service companies

NCDMB clarifies price disparity between Nigerian, foreign oil service companies

*From left: Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Engr. Earnest Nwapa, Group Executive Director, Exploration and Production, NNPC, Engr. Andy Yakubu, and the Chairman/Managing Director, Jagal Group, owners of Nigerdock during the presidential commissioning of the first Nigerian wholly-built offshore wellhead platforms at the Nigerdock fabrication yard, Snake Island, Lagos.

By Yemie Adeoye
Following complaints by some indigenous oil service companies that the spirit of price disparity between them and their foreign counterparts while bidding for jobs with International Oil Companies negates the spirit of fairness the Executive  Secretary of Nigerian Content Development and Monitoring Board (NCDMB) Engr.  Earnest Nwapa has clarified the reasons behind the development if it does exist.

Speaking with select Energy correspondents during the Presidential launch of Exxonmobil’s Abang and Itut offshore well heads wholly fabricated in Nigeria Engr. Nwapa said the issue is impossible as there are lots of things that people complain about which can be better explained to them.

“I can tell you that that cannot happen; there are a lot of things that people complain about, however, what you can say, and that is something we are addressing, is that there may be a disparity in the way they have put a fee structure for certain professionals and when you say somebody is a  local hand and an expatriate hand and that is all related to the number of years of experience and when we don’t have that clear issues, we begin to deal with that.”

*From left: Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Engr. Earnest Nwapa, Group Executive Director, Exploration and Production, NNPC, Engr. Andy Yakubu, and the Chairman/Managing Director, Jagal Group, owners of Nigerdock during the presidential commissioning of the first Nigerian wholly-built offshore wellhead platforms at the Nigerdock fabrication yard, Snake Island, Lagos.

“if you say that a lead engineer must have 15 years experience, Nigerians only started doing engineering design in the oil and gas industry about five or six years ago so you may never have a Nigerian who will be a lead engineer.

So these are the things that we must live with for some time and we are trying to restructure that arrangement so that it is not just years of service but competence, but it takes time. You would get to that point when you would have more work being done in Nigeria then you’d have more engineers, then you’d begin to look at the field and say okay, you’re already doing this; you must restructure how you price Nigerian labour.”

“As we sit here in Nigeria, we are sitting on prospects in the oil and gas sector, beyond the oil and gas we are sitting on major infrastructural programs for gas, power, rail, telecommunication and even agriculture. So our view is that if you put in all the work that the oil and gas industry will do you will only be taking thirty percent of the potentials in Nigeria.

By doing what we are doing successfully, we are already seeing all the sectors in the Nigerian economy trying to latch onto the Nigerian Content philosophy”. The NCDMB boss explained that it is a fact that whoever can build the platform being commissioned by Nigerdock can as well build telecoms masts and other highly technical projects.

“You can understand that anybody who can build that platform can build telecom masts of any complexity even the power pylons (that are used to cross high tension cables across the country) can now be manufactured in Nigeria; we do not need to import them anymore because the technology is now here.

We do not see ourselves as regulators in that sense. Nigerian Content Development, “development” is the key word there. The development part of it is not to be running after people, it is meant to bring people together and build things, build capacity, concession, innovation, technology and the monitoring part of it is after you have built so it is not a standalone.

We want to see in the next two years three to four pipe mills. I will be happy if I am around to bring the president to another pipe mill and say to him this pipe mill is going to supply gas between Calabar and Kano. This marine location is where we are going to dry dock.

We do not take our LNG tankers from Nigeria to Cameroun to fix a rudder those things can be done once we have support of the industry. Serious people who plan to use LNG tankers that as you are building your LNG fleet, you must have a dry dock as you saw how we drove to the dry dock in the yard here.

All we need is a bigger one and the revenue we take out of this country to do all our marine vessels outside will just come in here”. He enthused.

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