Beyond Participation: Rethinking the Measure of Nigerian Content

Nigeria has made substantial progress in addressing one of the defining questions of its oil and gas industry: how much of the value created by its hydrocarbon resources can be retained within the country?

The results of more than two decades of deliberate Nigerian Content policy are significant. Nigerian Content performance now exceeds 61%, compared with less than 5% in-country value addition before the Nigerian Content regime took hold,and the Nigerian Content Development and Monitoring Board (NCDMB) has set a target of 70% by 2027. Behind those percentages is a much larger transformation.

Nigerian companies today participate across segments of the oil and gas value chain that were once almost exclusively the preserve of foreign contractors. Nigerian professionals increasingly occupy technical, operational and executive positions historically dominated by expatriates. Indigenous service companies have invested in facilities, equipment, people, certifications and technology partnerships that would have been difficult to contemplate two decades ago.

That progress should be acknowledged.

But as Nigerian Content approaches its next stage of maturity, the industry should begin asking a more demanding question:

What lasting industrial capabilities has Nigeria developed from the participation created by Nigerian Content policy?

This distinction is significant.

Participation indicates who is engaged in economic activity.

Capability reflects the knowledge, infrastructure, technology, intellectual capital and technical competence that remain in Nigeria after that activity has been completed.

The future of Nigerian Content will increasingly depend on the country’s ability to transform participation into enduring capability.

From Expenditure Retention to Capability Retention

For much of the first five decades of Nigeria’s oil and gas industry, a significant proportion of the value-adding activity required to develop our hydrocarbon resources took place outside the country.

NCDMB has estimated the historical consequence at approximately US$380 billion in capital flight and two million job opportunities exported. But the cost of this dependence was never purely financial. Every major industrial project is also a vehicle for knowledge accumulation.

Engineers deepen their judgement through repeated execution. Technicians become more proficient as their exposure to difficult scopes increases. Organisations develop stronger quality systems by solving increasingly complex problems. Companies acquire equipment and certifications because contracts provide the economic justification for those investments.

In other words, industrial capability is cumulative.

When sophisticated work is repeatedly undertaken outside Nigeria, the associated learning, experience, infrastructure and technical competence accumulate elsewhere as well.

Conversely, when work is successfully executed in-country, the benefit can extend considerably beyond the immediate value of the contract. Each project has the potential to raise the technical baseline from which the next Nigerian project begins.

That is why the next chapter of Nigerian Content should concern itself not only with how much expenditure stays in Nigeria, but increasingly with how much capability stays in Nigeria.

What Should 70% Nigerian Content Mean?

As the industry moves towards NCDMB’s 70% target, the percentage itself will remain an important indicator of progress. But percentage participation should not become the destination. A mature Nigerian Content ecosystem should ultimately be visible in the increasing complexity of work that Nigerian companies and professionals can undertake to internationally acceptable standards.

Can equipment previously sent overseas for testing, repair or refurbishment now be handled locally?

Can Nigerian engineers diagnose problems that once required international mobilisation?

Can indigenous companies execute more technically demanding OCTG, machining, fabrication, well-completion and asset-integrity scopes?

Can internationally recognised certifications be maintained locally?

Can Nigerian facilities meet the quality, cost, safety and delivery requirements demanded by international operators?

And eventually, can capabilities develop through Nigeria’s domestic market become competitive enough to serve customers elsewhere in Africa? These questions may provide an increasingly useful measure of Nigerian Content maturity.

Lessons From Xi’an

This issue became particularly clear during a recent visit to Xi’an, China, where my team and I spent time with manufacturers of OCTG and well-completion equipment supplied into the Nigerian market. We walked production lines, engaged technical teams and examined the manufacturing processes, engineering discipline and quality-control systems behind equipment eventually deployed in Nigerian operations.

The experience reinforced an important point. Manufacturing capability is rarely created by purchasing machines alone. Behind every finished product sits an ecosystem: trained engineers, specialist technicians, material knowledge, quality assurance, certification, supply-chain discipline, production experience and the institutional knowledge accumulated through years of repeated execution.

For Nigeria, the strategic opportunity is therefore not simply to ask how quickly an imported product can be replaced by a locally produced one; the more useful question is:

Which elements of the capability behind that product can progressively and competitively be developed in Nigeria?

The answer will differ by technology. For one category, the immediate opportunity may be local technical support. For another, testing and refurbishment. Elsewhere, machining or assembly may be viable. And where sufficient demand, infrastructure and economics exist, domestic manufacturing may ultimately become sustainable, as the pathway matters as much as the destination.

From Technology Access to Technology Capability

During that visit, Titan Tubulars Nigeria Limited, a subsidiary of One Titanium, formalised an exclusive partnership with China Vigor Drilling Oil Tools and Equipment Co., Ltd. for designated completion tools and valve products across Nigeria and West Africa. The immediate commercial value is clear: expanding the range of technologies available to operators and creating regional technical support around those products. But the more important long-term opportunity lies in what follows.

Can Nigerian engineers develop deeper expertise around those systems?

Can support, testing, maintenance and troubleshooting capability progressively move closer to the customer?

Can the relationship provide the technical foundation for additional value-adding activities to take place locally?

Can knowledge that currently sits predominantly with an overseas manufacturing centre increasingly become available within Nigeria? Those are the questions that convert a commercial partnership into an industrial capability partnership.

At One Titanium, that philosophy also informs investments across machining, fabrication, OCTG & pipeline services, and repair and refurbishment, supported by the equipment, infrastructure, licenses, and certifications required to undertake increasingly complex work in-country.

Access to global technology and investment in Nigerian capability should not be seen as competing objectives. They are mutually reinforcing: global partnerships broaden the technologies and specialist expertise to which Nigerian companies are exposed.

Domestic investment determines how much of the associated technical responsibility, employment, knowledge and economic value Nigeria is ultimately equipped to retain.

The Role of Policy Must Also Evolve

NCDMB’s policy direction increasingly recognises this progression. Initiatives encouraging OEMs and their Nigerian partners to establish equipment-component manufacturing and assembly capability in-country, alongside certification frameworks that require verifiable facilities, equipment and technical personnel, reflect an important evolution. But policy can only create the environment, while Industry must build the capability. For indigenous service companies, this means making disciplined long-term choices about where to invest. It means acquiring equipment that expands technical capability rather than merely increasing asset count.

It means developing and retaining engineers and technicians capable of operating those assets.

It means securing internationally recognised certifications.

It means strengthening quality assurance and operational systems.

And it means structuring international partnerships around progressively greater Nigerian technical responsibility.

Operators also have a critical role. Industrial capability cannot develop without credible demand. Where technically qualified Nigerian companies have invested in internationally acceptable capability, procurement structures should provide them with a realistic opportunity to utilise it. Sustained utilisation is what converts installed infrastructure into genuine competence.

Banks and development-finance institutions similarly have a role to play. Industrial localisation is capital intensive, and the tenor of financing required for manufacturing equipment and specialist facilities often differs significantly from that required for conventional trading activity. The next stage of Nigerian Content therefore requires alignment between policy, procurement, capital, technology and demand.

Localisation Must Remain Commercially Sustainable

An important discipline must underpin this ambition. Not everything should be manufactured locally simply because it can be. Different technologies require vastly different levels of capital, utilisation, scale and specialisation. A manufacturing facility that cannot generate sufficient demand to remain technically current and commercially viable creates little enduring value.

International manufacturing centres will therefore remain an important part of Nigeria’s oil and gas supply chain. The objective should not be localisation at any cost. It should be the deliberate expansion of those areas where Nigerian capability can meet global expectations for quality, safety, cost, reliability and delivery. That is a much higher standard, and meeting it also creates a much larger opportunity.

From Import Substitution to Export Capability

The economic case for deeper Nigerian capability extends beyond reducing imports or conserving foreign exchange. Those are important benefits, particularly in an economy where FX availability and currency volatility directly affect project economics. But the larger opportunity is to create capabilities that eventually generate foreign exchange rather than merely conserve it.

Nigeria possesses one of Africa’s largest oil and gas markets. That scale provides indigenous companies with something extremely valuable: a domestic platform on which to build competence. If Nigerian companies use that opportunity to develop internationally competitive facilities, technical expertise and quality systems, there is no reason those capabilities should remain confined to the Nigerian market. The same engineers can support projects elsewhere in West Africa. The same machine shops can undertake regional work. The same testing, maintenance and refurbishment facilities can support neighbouring producing countries. The same Nigerian businesses that once depended almost entirely on international companies for technology and expertise can themselves become regional providers of those services.

This is where the economic logic of Nigerian Content becomes particularly powerful:

Participation creates opportunity.

Opportunity enables capability.

Capability improves competitiveness.

Competitiveness creates exports.

At that point, Nigerian Content moves beyond import substitution and becomes an instrument of industrial development.

The Next Measure of Success

Nigeria has already demonstrated that deliberate policy can transform domestic participation in an industry once overwhelmingly dependent on foreign capacity. That achievement should give us confidence about the next stage. But the next stage will be more demanding. It is easier to count participation than to measure capability. Capability is demonstrated through what remains after contracts have been completed:

Engineers with deeper expertise.

Technicians capable of undertaking more sophisticated work.

Companies owning internationally certified infrastructure.

Nigerian teams solving problems that previously required overseas intervention and domestic facilities performing work that was once automatically exported. International technology relationships that progressively transfer greater technical responsibility to Nigerian organisations and eventually, Nigerian companies exporting their own expertise to the rest of Africa and beyond.

As Nigerian Content approaches 70%, these outcomes should increasingly sit alongside percentage participation as indicators of success. The ultimate ambition should be larger than having Nigerians participate in Nigeria’s oil and gas industry. It should be to use the scale of Nigeria’s oil and gas industry to build Nigerian industrial capability. Because the most enduring measure of Local Content will not simply be how much Nigerians participated in yesterday’s projects; it will be what Nigeria is capable of doing tomorrow because of them”.

About the writer: Dr. Tina (Oby) Unachukwu is the Managing Director and CEO of One Titanium Nigeria Limited, a company at the forefront of Nigeria’s local content agenda in OCTG certification and industrial capacity. She brings over 25 years of experience across upstream E&P, downstream refineries, petrochemicals, and commercial leadership, having held roles at GE, ImproChem, Baker Hughes, and ClearSign Technologies.