Nigeria to boost domestic oil engineering requirement

Apr 14, 2005 02:00 AM

The Nigerian government will require key engineering and design work for oil and gas projects to be done locally by the end of 2005, a senior executive at the Nigerian national oil company said.
Front-end engineering and design, known as FEED, is the final stage in assessing a project's costs and feasibility before construction.

The measure is one of several adopted by the government to raise local contribution in the oil and gas industry to 45 % by 2006, and 70 % by 2010, said Nigerian National Petroleum Corp (NNPC) Group General Manager, Local Content, Joseph Akande.
Akande said the directive affects all LNG, joint venture, and production sharing contract projects in Nigeria.

The government has also directed that all fixed structures -- both offshore and onshore -- as well as anchors, piles, buoys, flare booms, and similar structures must also be designed locally.
"Henceforth, any project coming to NNPC for approval that does not fulfil these conditions will not be approved," Akande said.

NNPC estimates that the level of local content in the Nigerian industry is as low as 14 %, leaving little of the $ 9 bn spent each year in the country, Akande said. The policy doesn't mean a ban on foreign participation in these activities in Nigeria, Akande said.
"It allows foreign engineering companies to set up locally and work independently or in partnership with Nigerian firms." Oil companies in the country have also set up local content units charged with the responsibility of implementing the policy.

Source: Dow Jones
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