By March 2025, it would have been a year since President Bola Tinubu’s administration announced the commencement of three Directives on Local Content aiming for efficiency in Nigeria’s rebranded oil and gas industry, and who better to explain all the benefits that would be accrued to companies willing to go through the designated pathway if not the Nigerian Content Development and Monitoring Board (NCDMB).

The agency plans to initiate new Contracting Cycle Guidelines for the petroleum value chain in compliance with the directives. What that is supposed to do will be to accelerate oil and gas contract timeliness, sharpen the thirst for investments, and increase Nigeria’s crude oil production. These are all the reasons why the Board’s Executive Secretary Engr. Felix Omatsola Ogbe opened up to a workshop crowd recently in Lagos.

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NCDMB’s Project Certification and Authorisation Directorate (PCAD) organised this two-day Contracting Cycle Guidelines Sensitisation Workshop. It was for international and indigenous operating oil and gas companies and those they work with.  The training offered a platform to explain the provisions of the Guidelines and how they would be implemented in a seamless way that matches what the Nigerian Oil and Gas Industry Content Development (NOGICD) Act and the Presidential Directives had advised.

𝗣𝗥𝗘𝗦𝗦 𝗥𝗘𝗟𝗘𝗔𝗦𝗘

𝑷𝒓𝒆𝒔𝒊𝒅𝒆𝒏𝒕𝒊𝒂𝒍 𝑫𝒊𝒓𝒆𝒄𝒕𝒊𝒗𝒆𝒔: 𝑵𝑪𝑫𝑴𝑩 𝑻𝒐 𝑳𝒂𝒖𝒏𝒄𝒉 𝑵𝒆𝒘 𝑪𝒐𝒏𝒕𝒓𝒂𝒄𝒕𝒊𝒏𝒈 𝑪𝒚𝒄𝒍𝒆 𝑮𝒖𝒊𝒅𝒆𝒍𝒊𝒏𝒆𝒔, 𝑯𝒐𝒍𝒅𝒔 𝑺𝒆𝒏𝒔𝒊𝒕𝒊𝒛𝒂𝒕𝒊𝒐𝒏 𝑾/𝒔𝒉𝒐𝒑𝒔

The Nigerian Content Development and Monitoring Board (NCDMB)… pic.twitter.com/VVnPbjU9Oj

— NCDMB (@OfficialNCDMB) October 30, 2024

Engr. Ogbe who was represented by the Director, Project Certification and Authorisation, Engr. Abayomi Bamidele says the organisation he leads is a business enabler hence the decision to get stakeholders’ feedback before a move to launch the guidelines up for discussion.

The current thinking of the NCDMB is to commission the instructive document at the forthcoming Practical Nigerian Content Workshop set to be held from December 3-5, 2024 at the Nigerian Content Tower in Yenagoa, the capital of Bayelsa State. A rebranded fossil fuel industry has its fair share of constructive criticism over how mining crude oil warms the planet, but the NCDMB’s local content drive also empowers the companies that would be providing the tools that those harnessing the power of renewable energy can use to build.

And so to equip these oil and gas companies, the executive secretary pledged that his agency would gather them at a technical workshop one should anticipate in the first quarter of 2025. The goal would be to train their personnel on how to efficiently complete various technical documentation that meets with contracting procedures and nothing less.

Recall that three Presidential Directives are focusing on Local Content Compliance, the Reduction of Petroleum Sector Contracting Cost and Timelines and thirdly, on Oil and Gas Companies (Tax Incentives, Exemption, Remission, etc). Implementing these three demands the involvement of the NCDMB every step of the way but the agency won’t be working alone.

Some things must happen based on Engr Ogbe’s vision at the 2-day workshop. The premium margins charged by some service companies have to go, and stakeholders have to stop frequent policy changes and ensure that final investment decisions (FIDs) are signed regularly to birth new projects.

Setting a milestone, the executive secretary recommended that at least one or two FIDs should be signed at the annual oil and gas conferences, to create activities in the sector.

Ensuring the success of the Reduction of Petroleum Sector Contracting Cost and Timelines policy will mean NCDMB, the Nigerian National Petroleum Company (NNPC) Limited and its investment arm, the NNPC Upstream Investment Services (NUIS) working together closely. Away from this, NCDMB will then be busy with supporting oil firms to accelerate their projects and take advantage of the incentives that the directive on Oil and Gas Companies (Tax Incentives, Exemption, Remission, etc.), provides to those in such class.

Altogether, the directives have worked for good. They have reduced the period for concluding oil and gas contracts from 180days to preferential ranges. Contracting Timelines in the Memorandum of Understanding (MoU) the Board signed with the NNPCL and international operating companies in September 2023 have been revised and also, there is a reduction of the number of contacts with the NCDMB on the cycle.

The Board, confirms its executive secretary, has reduced its touchpoints from nine to five for open tenders and selective tenders while retaining only four touchpoints for single source contracts.

Very soon, the presidential directives will eliminate intermediaries with no demonstrable capacity and they will also help develop structured processes to determine, verify and document in-country capacities and capabilities.

This will most likely be beneficial to the robust pre-qualification and technical evaluation process the Board already hatched, while it is not relenting on policy revisions that provide clarity on in-country value addition for OEM representatives and in-country capacity captured in a 2-year audit.

Meiza Nigeria