Local Content: Senate to Investigate Lack of Patronage for Nigeria Pipe Manufacturers

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The Senate Committee on Local Content is to investigate the non- patronage of internationally certified Nigerian pipe manufacturing and coating company, SCC Nigeria Limited by NNPC and International Oil Companies (IOCs) contrary to the Nigeria Oil and Gas Industry Content Development (NOGICD) Act 2014.

The company located in Ushafa, Abuja with over 500 Nigerian employees had in time past manufactured different specifications of pipes for NNPC, Mobil Producing, Shell Development Company Limited, Nigeria Agip Oil Company, Chevron Nigeria Limited to the tune of $183.76 million between 2008 and 2014 but has been idle since then due to lack of patronage by players in the oil and gas and water project sectors of the economy.

Senator Solomon Adeola (APC, Lagos West) , Chairman of the Senate Committee who led 11 members of his committee including two principal officers of the Senate on an inspection tour of the factory at the weekend said  the committee will investigate the possible breach of the NOGICD Act by the NNPC and IOCs beyond the issue of competitive pricing stressing that there is no way our local industries can be competitive against foreign company’s imported products without patronage based on our local content law.

“We are surprised that we have such an internationally certified company here in Nigeria with antecedent of executing major contracts in the past and employing many Nigerians not being patronised as per our law. Already some constituents of a member of the Senate has been laid off as a result of non- patronage while huge foreign exchange has been taken abroad to procure pipes. Our law grants local company right of first refusal and there is no reason why this should not apply to this company” Senator Adeola stated.

He requested the company to furnish the committee with relevant information on their predicament as the committee is going to take up the issue with NNPC, IOCs and other stakeholders with a view to ensuring that the company employing many Nigerians resume operations at the earliest opportunity stressing that it is regrettable that local capacity already developed by the company are idle and being temporarily laid off.

Senator Dino Melaye (APC, Kogi West) a member of the committee whose view was shared by many members of the committee that spoke on the bewildering situation said it is unacceptable to have such a  huge specialised manufacturing concern employing many Nigerians remain idle while NNPC and OICs take pipeline contracts abroad contrary to our law adding that the committee must dig further to unravel why the company is not being patronised beyond the issue of competitive pricing.

Earlier, the Director of Operation of SCC Nigeria Limited, Mr. Wale Adebayo, told members of the Committee that the company got its last order in 2014 adding that since then there has been several pipeline contracts in the industry without recourse to the only Nigeria pipe manufacturing and coating company that has all international certifications. He said their findings point to competitive prices by mostly Chinese companies that are patronised by stakeholders contrary to the Local Content law.

Others senators on the tour are Senator Phillip Aduda (PDP, FCT) the Senate Minority Whip representing where the company is located, Senator Biodun Olujimi,(PDP, Ekiti South), Senate Deputy Minority Whip, Senator Stella Oduah (PDP, Anambra South), Senator Kabiru Marafa (APC, Zamfara Central), Senator Obinna Ogba (PDP, Ebonyi Central), Senator Gershon Bassey (PDP, Cross River South), Senator Abdullahi Sabi (APC, Niger North), Senator Abubakar Gumel (APC, Jigawa North West), Senator Peter Nwaobosi (PDP, Delta North) and Senator Garuba Kaka (APC, Borno Central).