By Udeme Akpan

THE Chairman, Petroleum Technology Association of Nigeria, Bank-Anthony Okoroafor, has said that Nigeria lost more than $400 billion to capital flight before the introduction of the nation’s Local Content Act of 2010.

In an interview with Vanguard over the weekend, Okoroafor said: “Before the Act, Local content was less than 5 per cent. Most fabrication/ engineering were done abroad. Rigs, vessels were mostly foreign owned. More than $400 billion capital flight with attendant unemployment figures.”

He said the Act has enhanced capacity development and multiplier effect of domestication and domiciliation, adding: “it has increased local content from less than 5per cent to above 38 per cent today. The entrepreneurial spirit has grown. Nigerian ownership of assets, rigs, vessels and equipment has grown in tremendous proportion. We now coat pipes in Nigeria.

“Feats considered impossible has been achieved. We have even gone as far as integrating a floating production storage and offloading, FPSO, in Nigeria – first of its kind by Total. Manpower development has increased and reduced reliance on expatriate workforce. There has been increase in indigenous participation in all aspects of the oil & gas value chain. Increase in quality employment generation and income.”

Oil price

He said the current low volatility in the global market has impacted negatively on the nation’s economy, adding: “Activity is very low. Difficulty in sustaining capabilities already built. We see service providers dropping experienced and well trained hands. We should not allow this to happen.”

PIB

Okoroafor, who noted that the lull has also affected investment said: “We need to pass the Petroleum Industry Bill, PIB  so that all the ambiguity associated with our oil and gas should be laid to rest. It will spell out with clarity all the fiscal terms and policies.”

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Problems

He stressed that the nation’s economy was affected by many factors, including lack of access to cheap finance, non- availability of jobs to sustain capabilities and capacities already built, weak manufacturing base, genuine reluctance to develop capacity, no short cuts, skills gap associated with broken educational system, lack of research and poor funding of our schools and poor infrastructure, especially lack of adequate electricity and transport.

Prospect

Okoroafor, who said the prospect was bright for the nation to grow its economy, however, called for introduction of friendly policies and improved funding.

He added: “Create more jobs, unlock the deep water projects (Bonga SW, Zaba Zaba, Prowei etc). Get our steel mills running again. Equip/finance and make our technical training centres to be the hub for employable skill training. Make them centres of excellence for welding, fabrication, integration and fitting. Let the industry partner more with academia in an integrated format instead of present day dispersed nature.”

Commitment

Recently, the Nigerian National Petroleum Corporation, NNPC and the Nigerian Content Development and Monitoring Board, NCDMB had expressed their commitment to growing Local Content in the Oil and Gas Industry from the current 40 per cent to 70 per cent by 2027 as part of strategies to sustain economic development in the country.

NNPC Group Managing Director, Dr. Maikanti Baru, had made this commitment while delivering a keynote address at the 8th Practical Nigerian Content Conference in Yenogoa, Bayelsa State, saying strategies for implementing the NCDMB Local Content development includes closing human capacity gaps, skills acquisition and assets ownership by indigenous companies, among others.

He had explained that the theme of this year’s conference: Driving Economic Development and Sustainability, is very relevant to NNPC, the industry and the country at large, given the considerable gains recorded in the nation’s Oil and Gas landscape.

The GMD had said that as early as 2005, despite almost 50 years of a vibrant national oil industry experience, NNPC was concerned at the low level of Nigerian Content in the country and thus called for a fresh approach to domesticating Oil and Gas Industry spend through the establishment of the Nigeria Content Division, NCD with the aim of identifying and guiding the implementation of key national content initiatives, including promoting local manufacturing of steel plates & pipes and developing engineering design expertise in the country.

Baru had maintained that by 2010, when the Nigerian Oil and Gas Industry Content Development, NOGICD, Act was enacted, a National Content Coordination Framework, which incorporates the key stakeholders in achieving increased linkage of the petroleum sectors with other sectors of the economy, was established under NNPC’s Nigeria Content Division, stressing that the Division then metamorphosed into today’s NCDMB.

The NNPC GMD had listed the achievements recorded in the development of Local Content to include ramping up pipe mills from 100,000MT/annum to 420,000MT/annum, representing 40 per cent of industry demand and the sustainable engagement of indigenous service companies and contractors to carry out NPDC’s operations and maintenance activities.