.Community contractors to access fund at 5%
The Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Mr. Simbi Kesiye Wabote has stated that the Nigerian oil and gas industry will domesticate the full capacity and capability required for the integration of Floating Production Storage and Offloading vessels (FPSO) by 2027.
Wabote has also disclosed that community contractors in the oil and gas industry will only pay five per cent interest rate when they access the Nigerian Content Intervention Fund (NCI Fund).
Speaking during the recent public hearing conducted by the Joint Senate Committee on Petroleum Upstream and Gas in Abuja, with the intent to determine the extent of compliance with the Nigerian Content Act and utilisation of the Nigerian Content Development Fund (NCDF), Wabote noted that the new target for the industry follows from the successful in-country fabrication of six modules of the Total Egina FPSO, which will be integrated into the FPSO at the SHI-MCI yard in Lagos in September 2017, stressing that this is the first time these feats were achieved in Nigeria.
The FPSO is the biggest component of the deepwater oil and gas project and the fabrication and integration of the modules at any location spurs multi-dimensional development and creates thousands of jobs.
Wabote stated that aother major target of the Board is to establish a Local Content Bank of Nigeria “to focus on establishment of facilities for domiciliation of services with emphasis on optimal use of local resource input.”
He disclosed that Nigerian Content activities recorded six million training man hours and is now able to retain$5 billion in the local economy from the annual $20 billion industry expenditure, which ended up in foreign economies in the past.
He stated that 36 per cent of the marine vessels operating in the Nigerian Oil and Gas Industry were now owned by indigenous players, a marked improvement from total foreign domination of the industry before the implementation of the Act.
On the NCDF, Wabote informed the law makers that international oil companies comply reasonably in remitting one per cent of the value of their contracts but some service companies and indigenous operating firms default in their payment.
He noted that the impact of Local Content in the oil and gas sector had not been sufficiently linked to other sectors of the economy and canvassed for the support of key government agencies in deepening Local Content in the country.
Speaking during an interactive session organised in Abuja for civil societies organisations (CSOs), Wabote stated that community contractors in the oil and gas industry will only pay five per cent interest rate when they access the Nigerian Content Intervention Fund (NCI Fund).
According to him, community contractors execute small scale projects and should not pay the same interest rate like conventional oil and gas service companies.
Wabote added that the concession for community contractors is in line with the Board’s Community Content Guideline and the provisions of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act.
“The intent is to promote the participation of genuine community contractors in oil and gas projects and integration of communities in the industry value chain as part of the strategy to grow the local economy and promote peace and tranquility in the communities,” he added.
Wabote also assured that the disbursement of the Content Fund to oil and gas companies will start this year, adding that the loan will be disbursed directly to qualifying companies by the Bank of Industry (BOI) and repaid within five years at eight percent interest rate.
The NCI Fund, he explained will cater for manufacturing, project financing and equipment purchase.
According to him, a key consideration for granting loan for a project is the impact it would make, he clarified.