Abuja — In accordance with the Nigerian Content Act, recently assented into law by President Goodluck Jonathan, 1 per cent of every contract awarded in the Nigerian oil and gas industry would be paid into the Nigerian Content Development Fund.
This disclosure was made in Onne, Rivers State, by the acting executive secretary of the Nigerian Content Monitoring Board (NCMB), Engr Ernest Nwapa, during the inspection of the pipe threading yard of Botro Marine & Oil Services.
Nwapa explained that the fund would be deployed specifically for developing the capacity of Nigerian service providers in the oil and gas sector.
He further explained that the fund was different from the $350m Local Content Fund, which was put together by the Nigerian National Petroleum Corporation (NNPC) in 2007 to serve as a working capital for Nigerian companies that got service contracts in the oil and gas industry, adding that it would be managed by NCMB.
“The fund will be managed by a proper fund manager with international best practices, so there is no question of utilising the find for what it is not meant for. You will have to show a business plan and prove that the investment will be able to repay the loan before it can be given,” Nwapa stated
He also explained that the vision of NCMB was to grow the funds and use it to attract other financial players who would leverage on it, such that Nigerian service providers would do business, knowing that the fund was available for them to use. Nwapa maintained that the Nigerian Content Act was very robust as it was put together by legislators who understood the oil and gas sector, with inputs from stakeholders in the industry.
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He urged Nigerians to take advantage of the opportunities, adding, “If Nigerians do not step up to take them, the board would not become manufacturers. The board would only protect the rights of manufacturers, so Nigerians should take advantage of the law.”
He noted that only about a 100 companies were operational at the Onne Free Zone a few years ago, but the number had swelled to 150. Nwapa stressed that the challenge for government would be to make sure that service providers at Onne Free Trade Zone got jobs.
He added that with the Nigeria Content Act now operational, it was no longer at the discretion of officials to decide what number of companies to give jobs to, and called on Nigerians to leverage on the oppurtunity.