Oil producing African Countries must formulate policies to deepen local participation and domiciliation – Sylva


Nigeria’s Minister of State for Petroleum Resources, H.E. Timipre Sylva has called on oil producing African countries to come up with policies that will deepen local participation and domiciliation in the Content.

The Honourable Minister made this call recently while declaring open the maiden edition of the African Local Content Roundtable, at the Nigerian Content Towers, Bayelsa State, Nigeria.

Sylva tasked African countries to make firm decisions and develop policies and projects that will position its industries competitively and sustain its economy under the emerging Energy transition.

 Sighting Nigeria as example worthy of emulation, the Minister stated that “the Federal Government of Nigeria, took firm steps in this regard very recently by funding two strategic projects in Nigeria; a 10,000 tons per day methanol plant and a 500 million standard cubic feet per day gas processing plant in Brass, Bayelsa state and the ammonia and fertilizer plant in Akwa Ibom.”

He lauded the NCDMB for initiating the roundtable event, stating that it has set the pace as the foremost local content regulator an example to other African Nations.

“I commend the NCDMB for initiating this roundtable. By this effort we have set the pace as the premier local content regulator in Africa and a worthy example to Sister nations that seek guidance to institutionalize local content practices in their jurisdictions.

“We must therefore use the opportunity of this roundtable to initiate conversations around local content, share success stories, challenges and come up with policies that will deepen local participation and domiciliation in our respective countries,” Sylva implored.

He lauded the partnership with African Petroleum Producers Organization, (APPO), while expressing hope that it would translate into a sustainable structure for driving regional collaboration on local content matters.

“The partnership with Appo is also very commendable as it will provide a sustainable structure for driving regional collaboration on Local content matters.

“The objective of this Pan African roundtable is to institutionalize clear review mechanisms among oil producing countries on local content as a key development imperative for domestication and sustainable growth of Africa’s Hydrocarbon resources,” he stated.

Sylva stressed that Nigeria adopted local content as an economic development model for the oil and gas sector in view of its abundant hydrocarbon resources estimated at about 37 billion barrels of Crude oil and 203 trillion cubic feet of Gas reserves.

“We define local content as value added tool upgraded in the Nigerian economy by a systematic development of capacity and capabilities through deliberate utilization of Nigerian services, human and material resources in the Nigerian Oil and Gas Industry.

“Through implementation of local content, we have achieved significant growth in the value chain and value addition in country from less than 5% percent in 2010 to 35% in 2021, and we have set an ambitious target to achieve 70% local content in oil and gas sector in 2027,” he buttressed.

The Minister pointed out that in spite decades of hydrocarbon production in Africa, the continent is yet to achieve desired economic growth, tracing mismanagement and a failure to domesticate the core operations of the industry as the root causes, he called for collaboration and cross-country development through the African Continental Free Trade Area, AfCFTA.  

He said; “We all know that decades of hydrocarbon production in Africa have not translated to the desired economic growth in our continent. While over 15 African Nations are producing and exporting crude oil, the sad reality is that our people have not benefited maximally from this natural resource either because we have not managed to close it optimally or we fail to domesticate the core operations of the industry.

“One of the pathways of this desired collaboration and cross-country development is the Africa Continental Free Trade Area, AfCFTA, as it provides an opportunity to create a single market through the facilitation of free movement of goods, services and investment within the 54 member states of the continent, creating access to 1.2 billion customers with accumulating GDP of over US $3.4 Trillion.

“It is imperative that African Oil Producing Countries and their Companies cooperate closely in developing and sharing capacities and capabilities to optimize the hydrocarbon deposits and achieve economic growth and development. For example, we established the biggest FPSO integration yard in Lagos Nigeria, and so many other facilities that can be used by other African Countries.

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