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Nestoil, others operate below capacity despite investments to boost Local Content

By Udeme AKPAN
WITH the making of a commercial oil find in 1956, there were strong indications that the International Oil Companies, IOCs would dominate Nigeria’s oil and gas industry for some reasons. First, the IOCs had the technology and other resources to invest in exploration and production of oil and gas. Second, their indigenous counterparts were not visible then.

Nestoil

But a lot has changed for good in the past 62 years, especially after the enactment of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act in 2010, which gives much support to the development of local content and capacity building of indigenous oil and gas companies.

Take the Nigerian Content Research and Development Council (NCRDC) as an example. Recently, the Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu said NCRDC has been established to advise the Nigerian Content Development and Monitoring Board (NCDMB) on matters relating to Research, Development and Innovation strategy for the oil and gas industry.

The council’s terms of reference are to “advise the Board on criteria and methodology for prioritising market cum demand-driven research projects, advise the Board on the appropriate strategies and governance arrangements to attract funding for research projects and advise the Board on criteria for the award of research grants and review progress on impact of such grants on Research projects, Product development and Innovation.”

But much impact on indigenous operators and by extension Nigeria’s economy may not be felt in a short or medium term as investigations showed that many indigenous companies, especially Nestoil Group are currently operating below their capacities.

Speaking for the Nestoil Group, including companies – Nestoil Ltd, Energy Works Technology (EWT) Ltd, IMPaC Oil & Gas Engineering Ltd, Hammakopp Consortium Ltd, B&Q Dredging Ltd, NestHak HDD Ltd, Shipside Drydock Ltd, Scorpio Drilling Ltd, NestAv Ltd, Century Power Generations Ltd and White Dove Shipping Company Limited – Managing Director, IMPaC, Mr Chuka Eze, said during a recent facility tour of the group’s facilities in Port Harcourt, Rivers state that: “Despite tremendous installed capacity, the Nestoil Group is operating well under capacity at a time successive governments have continued to promote local content in the Oil and gas industry. For example, EWT has the capacity to fabricate over 12 thousand metric tonnes of pressure vessels, Christmas Trees etc for local and foreign companies but is currently producing less than 20 per cent of that capacity.”

Mr. Eze, whose company has already carried out a detailed design of Forcados/YokriIntegrated Project New Onshore Scope, OkolomaGas Plant & Pipeline Project, AfamGas Receiving Plant Onshore, Built Generation 3D Laser Scanning Deep Offshore and Bonga FPSO Topside & Hull 3D Laser Scan said: “Impac (an engineering design and management company) has capacity to deliver 400,000 man hours per annum but is currently delivering about 54,000 man hours”.

The entire Nestoil Group of Companies (about 13 respective companies) has created well over 2,000 direct jobs and over 5,000 indirect jobs.”
He said: “The Group’s team of engineers have performed a rare feat in the operation of the Oil Mining Lease, OML 42 oil field by devising an efficient system of separating gas oil and water at the Odidi and Jones Creek Flow stations. If this technology were adopted throughout the entire Oil and gas sector, it would be easy to actually ascertain the Nigeria’s true production of crude oil.

”Three of the companies in the Nestoil Group (B&Q, Nestoil and EWT) were identified last year as companies that will lead Africa’s growth in the next decade. Over 98 percent of the workforce in Nigerian engineers fabricators, welders, architects etc.

“Shipside Drydock has just completed an ultra-modern fully furnished training centre with a capacity for 100 students at a time. The training facility will serve the entire O&G industry for training engineers, welders, machinists, fabricators etc. The Nigerian Content Development and Monitoring Board (NCDMB) is working with Nestoil group to adopt the school.”

The group stated that it has expertise in many areas. Referring to B&Q Dredging which has expertise in dredging, declamation, sand filling of road embankments, flood and Erosion Control, Shore Protection and Consolidation, Canalization/Channelization, Demarcation of navigable channels, Urban Renewal and Reclamation Services, River Crossing, Sweeping of Wellhead slots and Access Channels, Land and Hydrographic Survey and Dredge Consultancy, he said: ”we are a wholly Nigerian owned Company that commenced operations in 1996. We provide all facets of dredging solutions.

“Global operating standards (ISO 9001:2015, BS OSHAS 18001:2007 certified). LSE Group Award as one of the companies to lead Africa in the next decade (2017).”

It also indicated that another company, EWT Energy Works Technology Limited remains a wholly Nigerian Owned Fabrication, Manufacturing, EPC, Operations & Management Company that commenced operations in 2012. It is located on 53 Hectare Nestoil Industrial Area in Abuloma with access to open sea via Bonny River and a reinforced Load out jetty.

The Group Managing Director of Nestoil Group Dr Ernest Azudialu-Obiejesi said the oil and gas industry stands to gain a lot of from supporting indigenous companies because of the positive ripple effects on job creation, technology transfer and overall infrastructure development.

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