Nigeria’s oil sector spends $ 10 bn on foreign products and services

Jan 02, 2007 01:00 AM

NNPC Group General Manager, Nigerian Content Development (NCD) Unit, Mr Joseph Akande, says that about $ 10 bn are spent on foreign products and services in the oil and gas sector annually.
“This huge amount has little or no impact on the indigenous oil and gas companies and employment,’’ Akande said Abuja. He said that the industry estimates showed that Nigerian companies received less than 5 % of the annual expenditure made by oil companies operating in Nigeria.

Akande said that to change that the present administration since its inception concentrated on how to strengthen indigenous capacity and local content in oil and gas industry. According to him, the development of local content is being driven at the highest level of authority.
Akande said that already a road map had been designed to unlock the benefits in the oil and gas sector. The GGM said that 250 engineers were being trained every quarter to boost engineering activities in the oil and gas sector since all engineering works in the sector must be domiciled in the country.

He said that the NCD, which was launched in the first quarter of last year, had moved up the Nigerian content performance index considerably.
“A target of 28 % local content in the industry is achievable by the end of this year and up to 70 % in 2010 given the committee of all stakeholders,’’ he said. He said that in the past more than 85 % of “the oil and gas spend’’ were spent abroad, resulting in a situation where more jobs were created abroad for Nigerian projects.

According to him, the trend is now reversed since all engineering works must be carried out in the country, and noted that that was going-on well. He said that the NDC was collaborating with equipment manufacturers to come and establish plants in the country, since Nigeria did not manufacture up to 5 % of the 54 % oil and gas procurement requirement.
The GGM said that Mittal Group of UK, SeAH as well as Hyundai had concluded plans with the NCD to set up a pipe manufacturing company in Nigeria.

Source: Vanguard
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