Abuse of Nigerian Content in Midstream, Downstream Should Be Checked

Abuse of Nigerian Content in Midstream, Downstream Should Be Checked

The federal government will shift focus from the upstream sub-sector to the downstream and midstream sub-sectors of the Nigerian oil and gas industry in the implementation of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act of 2010, the new Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Mr. Simbi Wabote has said.

The newly-constituted board of the local content monitoring agency has also written to the midstream and downstream operators to study the NOGICD Act properly and ensure prompt compliance to its provisions.

Speaking at a special panel session of the Sixth Practical Nigerian Content Conference that ended in Abuja at the weekend, Wabote noted that Section 106 of the NOGICD Act empowers his agency to superintend on the activities of the upstream, midstream and downstream sub-sectors of the oil and gas industry.

He, however, acknowledged that the only area the NOGICD Act exempted the midstream and the downstream sub-sectors is in the payment of one per cent of the value of every contract awarded in the industry into the Nigerian Content Development Fund (NCDF).

NCDF was established by Section 104 of NOGICD) Act of 2010 to address paucity of funding faced by manufacturers, service providers and other key players. The Fund is pooled from one per cent of every contract awarded in the upstream sector of the industry and is managed by the NDCMB.

Wabote added that since the Act was enacted, the focus has always been on the upstream segment of the industry, adding that his board will soon develop a strategy to penetrate the midstream and downstream segments.

“I think one of my strategic focus in the life of this board and council members is to now begin to look at the downstream as well as the midstream. If you check Section 106 of the NOGICD Act itself, it clearly states that the board shall superintend on the activities of the upstream, midstream and downstream. The only area they are exempted from is the payment of one per cent fund. That is only focused on the upstream sector,” he explained.

Wabote said his agency was mindful of the enormous challenges facing the sub-sectors, particularly the refining sector, which has been struggling to sustain themselves with regards to refining products for Nigerians. He, however, said there were still enormous opportunities for Nigerians in the sub-sectors, adding that as part of the efforts to penetrate the downstream, the agency last week wrote the operators to study the NOGICD Act properly and ensure full compliance.

“Before I left office this morning, we sent letters out to some of the midstream operators, asking them to ensure that they find time to read the Act and also do everything in compliance with the provisions of the Act. Gradually, we will penetrate into these sectors, not just to be a policeman to the industry but also to work with them, to look for opportunities for Nigerians so that Nigerians can participate actively in that sector,” Wabote added.

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