Best practice for local content development strategy. An act to dissolve the nigerian national oil corporation and to establish the nigerian national petroleum corporation empowered to engage in all commercial activities relating to the petroleum industry and to enforce all regulatory measures relating to the general control of the petroleum sector through its petroleum inspectorate department. The nigerian content development and monitoring board ncdmb was established in 2010 by the nigeria n oil and gas industry content development nogicd act. The local content act 2010 enactment, enforcement and. The rule of law in the nigerian oil and gas industry. Local content development in the nigerian oil and gas. The nigerian national petroleum commission nnpc, has reiterated its commitment to promote indigenous participation in the nations oil and gas sector. The nigerian national petroleum corporation nnpc is the oil corporation through which the federal government of nigeria regulates and participates in the countrys petroleum industry. Local content refers to a set of policies that increase the utilisation of national human and material resources in the oil sector and do miciles incountry oilrelated economic activity previously located abroad.
Mineral leasing act for acquired lands of the united states of 1947 minerals oil safety regulation 1963. As from the commencement of this act, the minimum nigerian content in any project to be executed in the. Documentation to demonstrate that the entity is a nigerianregisteredowned company. Content development nogicd act in 2010 to promote local content development throughout the sector. Nigerian content development bill 2005a bill to make provi. Countries can encourage local content through requirements and targets written in national laws. The group managing director of the nigerian national petroleum corporation nnpc dr. An act to dissolve the nigerian national oil corporation and to establish the nigerian national petroleum corporation empowered to engage in all commercial activities relating to the petroleum industry and to enforce all regulatory measures relating to the general control of the petroleum. Nnpc, ncdmb to grow nigerian content to 70% by 2027. The local content law seeks to increase indigenous participation by prescribing a minimum threshold for the use of local services and promoting the employment of nigerian staff in the industry.
Ncdmb is vested with the mandate to make procedures that will guide, monitor, coordinate and implement the provisions of the nogicd act signed into law on april 22, 2010. Were committed to local content law nnpc punch newspapers. The case for publishing petroleum contracts in nigeria. Ncdmb act as facilitator, bringing together a broad array of. The nigerian state has been faced with various economic, social, political, educational, and development problems in all sectors of the nigerian economy. The enactment of the nigerian oil and gas industry content development act, no. The local content act 2010 enactment, enforcement and matters arising preliminary. Request pdf the nigerian local content act and its implication on technical and vocational education and training tvet and the nations economy the nigerian state has been faced with various. Prior to this, the nigerian government local content policy implementation had been administered by guidelines issued and enforced by the regulatory agencies of the federal government of nigeria such as the department of petroleum resources dpr and the nigerian content division of the nigerian national petroleum corporation nnpc. What matters when it comes to adopting local content. Nigeria has also applied local content policy in other sectors.
A serious attempt was, however, made in 2010 with the promulgation of the nigerian oil and gas development. Thursday, april 22, 2010 witnessed a landmark in the history of the nigerian oil and gas industry the industry by the signing into law of the nigerian oil and gas industry content development bill also known informally as the nigerian content bill or local content bill by the then. This had impacted the ability of the iocs to continue to invest. The amendment of the nigerian national petroleum corporation nnpc act last wednesday has been described as a milestone by most nigerians. Nigerian oil and gas industry content development act 2010, cap. Local content is major change from importer to producer will be resisted globally and locally. Nigerian content division of nnpc on or before 31st january of every year. Nnpc restates commitment to local content the guardian.
Determine if nigerian indigenous contractors have the capacity to perform services listed in the schedule of services issuing regulations for the industry regarding local content. From an analysis of the sector, the local content act seems to have made very little impact. Noc became nigerian national petroleum corporation nnpc in 1977. Average local content commitment resulting from bidding rounds 19992008 19 figure 3. Its primarily objective is to ensure that nigerian content in terms of human capital, resources and contracts is given priority in the oil and gas industry. The policy is designed to build the capacity of indigenous firms and to provide more opportunities for participation in business. Act or in any other enactment or law, the provisions of this act shall apply to all matters pertaining to nigerian content in respect of all operations or transactions carried out in or connected with the nigerian oil and gas industry. Nnpcs explanations for how it spends the revenues it retains are incomplete and contradictory, and the spending such as on the fuel subsidy and downstream operations delivers poor value for money. A legal device in the form of an act, statute or regulation to give it normative force. Nnpc restates commitment to local content realnews magazine. The nigerian oil and gas development law 2010 defines local content as the quantum of com posite value added to or created in ni geria through utilization of. Petroleum act offended the provisions of section 44 of the constitution. Nnpc rates compliance to nigerian content act at 56%. Setting minimum nigerian content level for project or project items which were not included in the schedule a to the act the boaoa drd aasolso has popo e swers to.
Speaking on the theme local content compliance in an extended low oil price environment, baru observed that over the years, the nnpc had been at the forefront of championing local content even before the enactment of the local act in 2010. Act the nigerian content act or nogicd act in 2010, significant progress has been made. Nnpcs nigerian content vision is to transform the oil and gas industry into the. A draft nigerian content development bill has been submitted by nnpc to government. Local content policy in nigeria started in 1971 through the establishment of the national oil company noc to promote the indigenisation policy in the oil and gas sector. The case for publishing petroleum contracts in nigeria rob pitman and anne chinweze petroleum contracts are fundamental documents that set out the legal framework for oil and gas projects. It stated that operator means the nigeria national petroleum company nnpc, its subsidiaries and joint venture partners and any nigerian, foreign or international oil and gas company operating in the nigerian oil and gas industry under. Thus, the focus of this paper is to briefly explain the local content act and its implication on tvet and the nigerian economy. The new nigerian oil and gas industry content development act since the discovery of oil in commercial quantities in oloibiri, rivers state by shell corporation in 1957, the nigerian oil and gas industry has grown to become a major player in the international oil and gas market. Sep 04, 2015 the local content law seeks to increase indigenous participation by prescribing a minimum threshold for the use of local services and promoting the employment of nigerian staff in the industry. According to him 2,258 vessels are currently operating in nigerian oil and gas industry and that 848 of the vessels were nigerianowned, representing. Nigerian oil and gas industry local content development. Through the nigerian content directives that were issued by the nigerian national petroleum corporation nnpc as a pre qualification criterion for any contracts executed and the 1 st schedule of the petroleum act, the local content initiative is provided through specifically requiring the holder of an oil mining lease oml to ensure that. Sep 21, 2017 he said, on our part, the nnpc is strongly committed to the successful implementation of all provisions of the nigerian content act to improve and accelerate local capacity development in all.
Pipelines and products marketing company limited a. General nigerian content requirements companies responding to expression of interest advertisements are required to submit the following in compliance with the nigerian content act, 2010. Tied to national agenda chairman governing council is member of fec and direct report to president. The executive secretary, nigerian content development and monitoring board ncdmb, mr simbi wabote, told nan in lagos that the development was a marked improvement on what was obtained in 2010. Nigerian oil and gas industry content development act, 2010.
Therefore, it was concluded that the nigerian local content act adds value to technical and vocational education and training tvet in nigeria. A nigeria content development and monitoring board the board has been established and vested with the responsibility to implement the provisions of the act, make procedural guidelines and monitor compliance by operators within the oil industry. Group managing director of the nigerian national petroleum corporation nnpc the nigeria union of journalists nuj has expressed delight with the pledge by the group managing director of the nigerian national petroleum cor the nigerian national petroleum corporation nnpc has. Foster measurement and implementation of local content.
Nnpcs nigerian content vision is to transform the oil. He said, on our part, the nnpc is strongly committed to the successful implementation of all provisions of the nigerian content act to improve and accelerate local capacity development in all. Jul 28, 2010 the local content act 2010 enactment, enforcement and matters arising preliminary. The regulation which is the responsibility of dpr will be ready once. This paper undertakes the first stakeholder analysis of the nigerian oil and gas industry local content development lcd policy to gain a better understanding of the extent of stakeholders interactions and how such interactions align to conditions conducive to local content development.
The nigerian oil and gas industry content development act 2010 the act seeks to increase indigenous participation in the oil and gas industry by prescribing minimum thresholds for the use of local services and materials and to promote transfer of technology and skill to nigerian staff and labour in the industry. Maikanti baru, has commended the 8 th national assembly over the improved relations between the corporation and the lawmakers, confirming that there is improvement on the level of local content compliance across installations, fabrications, procurement and various level of engineering in the oil and gas industry. Conceptualizing tvet in most advance economies, industrialization most certainly emanate from tvet kutz, 2001. Publishing them creates space for muchneeded public scrutiny of deals that can be worth billions of dollars to the people of nigeria. The nigerian national petroleum corporation, nnpc, and the nigerian content development and monitoring board, ncdmb have committed to growing local content in the oil and gas industry from the current 40 percent to 70 percent by 2027 as part of strategies to sustain economic development in the country. Local content development in the nigerian oil and gas industry local content development is critical for countries like nigeria that are rich in natural resources but whose oil and gas sector has traditionally operated in isolation from the rest of the economy, thereby allowing minimal participation from local citizens in its development. Minimum content of environmental impact assessment. Notwithstanding the provisions of part i of this act, an environmental impact assessment shall be required where a federal, state or local government agency authority established by the federal, state or local government council. Nigerias recent efforts to pass local content legislation with stringent targets and. The targets for lc policy in increasing local content development were set progressively. Nnpc restates commitment to local content realnews. The nnpc business operations are managed through strategic business and corporate services units sbuscsus in diverse locations across nigeria. Nigerian national petroleum corporation nnpc is empowered pursuant to nnpc act lfn cap. The nigerian oil and gas content development act of 2010 has provisions to.