Jerome Onoja Okojokwu-Idu

The Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Engr. Simbi Wabote, has charged African countries to take advantage of the opportunities and platform that the African Continental Free Trade Area (AfCFTA) provide to develop local content on the continent.
Wabote gave the charge in a presentation at the Petroleum Technology Association of Nigeria (PETAN) organised session, at the recently concluded Offshore Technology Conference (OTC) in Houston, Texas, United States.

AfCFTA is an initiative of African leaders  to harmonize the continent’s markets for economic integration across all 55 member states with the objective of creating a single market with a   Gross Domestic Product (GDP) valued at $3.4 trillion.
With the official commencement of AfCFTA, he said that its focus on addressing pertinent issues such as settlement of payment, rules of origin and standards, there are now positive prospects for African businesses, adding that he sees “AfCFTA as the practice of Local content at the continental level.”
According to Wabote, AfCFTA  and local content are not mutually exclusive, but complementary, stressing that AfCFTA is an elevation of local content at the continental level.

He noted that “we are at a point in which regional blocks are coming together to re-evaluate their energy dependency and work out areas of collaboration to address either energy or developmental needs, and Africa as a continent must not be left behind in developing its own response to the prevailing challenges.”
He identified regulatory framework, gap analysis, capacity building, funding and incentives, research and development as well as market access as key component for the growth of local content in the oil and gas industry and other sectors of the economy.
“The practice of local content in the oil and gas industry and indeed any sector entail the development of the six key frameworks. An enabling regulatory framework backed by the appropriate legislature is very fundamental to local content development and practice. A law and decree depending on the political arrangement of a country set the framework and boundaries for all local content practitioners,” he said.

“While the law may not be all-encompassing, consideration should be given to other key sectors of the economy rather than just the oil and gas.”
Before the enactment of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act in 2010, local content in the Nigerian oil and gas industry was less than 5 percent. Wabote disclosed that the NCDMB has increased local content in the country’s oil and gas industry to 42 percent.
He said, “Based on our monitoring of the industry, we have moved Nigerian content to 42 percent from less than five percent before the advent of the NCDMB in 2010. Four years ago, we launched our 10 years strategic program to move Nigeria’s content in the oil and gas industry to 70 percent by the year 2027. Other strategic initiatives, under the specified period have been implemented to ensure the goals are achieved.

Key lessons learned as regards the gap analysis are that it is good to have baseline data for available in-country capacities and capabilities to identify the existing gaps and set the target for that closure. There is a need to strike the balance between inspirational goals and realistic target setting. Both are important in driving investment, motivation and taking cognizance of local peculiarities.”
Noting the importance of funding and incentives in the implementation of local content programs, he said that they are critical in developing infrastructure, attracting big investment and keeping  existing business afloat.

“Structured capacity building interventions are essential to spur the development of in-country capacities and capabilities. This is not limited only to local manufacturing and infrastructural development, but also to human capacity development,” the NCDMB boss said.
“Funding and incentives are essential to implement local content programs, develop infrastructure, attract big investment and keep the existing business afloat when required in the Africa.”

“We have also progress initiative with the African Petroleum Producers Organizations, APPO, to pull together funds to support the development of oil and gas development project in Africa,” he added.
The research and development spend as a portion of GDP in Nigeria is 0.2 percent, which is meagre. It is relatively the same in most African countries. Wabote harped on the need for investment in R&D to drive homegrown technology development and build a robust local content on the continent.
“Local content thrives where there are robust research and development guidelines to drive the development of homegrown technology is essential in deepening local content practice,” he stated.

Emphasising on the importance of having a regulatory framework to drive local content development, he said that “A law or decree, depending on the political arrangement in a country, sets the framework and boundaries for all local content practitioners”, adding that it “better than directives, or policies that are enshrined with the pretext of pushing the boundaries of local content.”

Wabote commended PETAN for putting together the session to discuss African local content strategy at the conference saying,”The idea by PETAN to put together participants and visitors to this year’s OTC to have a strategy session to discuss African local content strategy is commendable, especially against the backdrop of the ongoing energy transition narratives and the shifting dynamics of security of energy supply across the globe.”
OTC is a platform where energy professionals across the globe meet to exchange ideas and opinions to advance scientific and technical knowledge for offshore resources.
OTC gives attendees access to leading-edge technical information, the industry’s largest equipment exhibition, and valuable new professional contacts from around the world.

PETAN, an association of indigenous Technical Oilfield Service Companies, has been responsible for leading and hosting the Nigerian delegation to the event annually.