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Alison-Madueke Blames IOCs, Contractors for Capital Flight

30 Aug 2011

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Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke

By Chika Amanze-Nwachuku

Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, has expressed concern that after many decades of oil exploration and production in Nigeria, contractors and multinational oil companies, (International Oil Companies) that had done business worth several hundred millions of dollars in Nigeria, had not left appreciable footprint in the petroleum industry.

She said, instead these operators place more emphasis on speedy achievement of first oil and generation of revenue without paying attention to actions that add value to the economy.

Speaking at the just–concluded annual conference by National Association of Energy Correspondents (NAEC) in Lagos, the Minister lamented that major operators in the industry relied on the importation of goods and services from abroad without making provisions to develop sustainable capabilities within Nigeria that would support life cycle operations in Nigeria.

She said: “Instead the trend has been to look to foreign countries for procurement of equipment, spares and technology in support of their operations in Nigeria and Gulf of Guinea region”.

The Minister said the cumulative effect of operating such model for so long is that in an industry that currently spends an average sum of $20 billion per annum, less than $2 billion is retained in the National economy and over $300 billion lost to capital flight in this way.

“Of more significance is the fact that this persistent practice has actually resulted in the export of millions of employment opportunities, opportunities for training, knowledge and technology transfer, opportunities for investment in facilities and infrastructure to support industry operations within Nigeria and denied indigenes of Nigeria the opportunity to participate in the most critical aspect of their national development activity,” she said

She assured that local and foreign partners that government would create enabling environment that allows capital to flow inward and get retained for economic growth and development.

“I want to reassure Nigerians and our international partners that the government has taken firm steps to address these concerns in a structured and sustainable manner”, she stressed.

The Minister also restated that the Nigerian Content Act was not intended to indigenise the oil and gas industry or nationalise assets of investors in the Nigerian economy; rather it sets provisions that guarantee that investments made in facilities within the country will be fully utilised.

Tags: Business, Nigeria, Featured, Petroleum Resources

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