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. 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. 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. Thus, the focus of this paper is to briefly explain the local content act and its implication on tvet and the nigerian economy. An overview of the nigerian oil and gas industry local. 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. 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. The local content act 2010 enactment, enforcement and matters arising preliminary. The nnpc business operations are managed through strategic business and corporate services units sbuscsus in diverse locations across nigeria. The nigerian oil and gas content development act of 2010 has provisions to. Nnpcs nigerian content vision is to transform the oil. The targets for lc policy in increasing local content development were set progressively. An act to dissolve the nigerian national oil corporation and to.
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. 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. As from the commencement of this act, the minimum nigerian content in any project to be executed in the. 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. 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. Petroleum act offended the provisions of section 44 of the constitution.
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. Nigerias recent efforts to pass local content legislation with stringent targets and. Were committed to local content law nnpc punch newspapers. Nnpc restates commitment to local content the guardian. A draft nigerian content development bill has been submitted by nnpc to government. Nigerian oil and gas industry local content development. Nigeria has also applied local content policy in other sectors. The group managing director of the nigerian national petroleum corporation nnpc dr.
Nambian constitution nigerian national petroleum corporation act, cap n123 laws of the federation of nigeria, 2010. Nigerian national petroleum corporation nnpc is empowered pursuant to nnpc act lfn cap. 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. 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. Foster measurement and implementation of local content. Nnpc rates compliance to nigerian content act at 56%. 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. The nigerian national petroleum commission nnpc, has reiterated its commitment to promote indigenous participation in the nations oil and gas sector. 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. 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. As from the commencement of this act, the minimum nigerian content in any project, service or product specification to be executed in the nigerian oil and gas industry shall be consistent with the level set in the. 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. 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. Nnpc restates commitment to local content realnews magazine.
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. The local content act defined what operator and partner mean in section 106 of the local content act. What matters when it comes to adopting local content. The nigerian state has been faced with various economic, social, political, educational, and development problems in all sectors of the nigerian economy.
Noc became nigerian national petroleum corporation nnpc in 1977. Therefore, it was concluded that the nigerian local content act adds value to technical and vocational education and training tvet in 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. The rule of law in the nigerian oil and gas industry. The amendment of the nigerian national petroleum corporation nnpc act last wednesday has been described as a milestone by most nigerians. 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. Nigerian content division of nnpc on or before 31st january of every year. 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. 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. A serious attempt was, however, made in 2010 with the promulgation of the nigerian oil and gas development. Average local content commitment resulting from bidding rounds 19992008 19 figure 3. Act the nigerian content act or nogicd act in 2010, significant progress has been made. 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.
The case for publishing petroleum contracts in nigeria. The role of local content policy in local value creation. Nnpcs nigerian content vision is to transform the oil and gas industry into the. Nigerian oil and gas industry content development act 2010, cap. Publishing them creates space for muchneeded public scrutiny of deals that can be worth billions of dollars to the people of nigeria. A legal device in the form of an act, statute or regulation to give it normative force. 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. 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. 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. Mineral leasing act for acquired lands of the united states of 1947 minerals oil safety regulation 1963. The regulation which is the responsibility of dpr will be ready once. From an analysis of the sector, the local content act seems to have made very little impact.
This had impacted the ability of the iocs to continue to invest. 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. Documentation to demonstrate that the entity is a nigerianregisteredowned company. 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 local content act 2010 enactment, enforcement and. Local content is major change from importer to producer will be resisted globally and locally. Nigerian content development bill 2005a bill to make provi. 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. 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.
Jul 28, 2010 the local content act 2010 enactment, enforcement and matters arising preliminary. 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. The nigerian content development and monitoring board ncdmb was established in 2010 by the nigeria n oil and gas industry content development nogicd act. 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 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. Pipelines and products marketing company limited a. Conceptualizing tvet in most advance economies, industrialization most certainly emanate from tvet kutz, 2001. Nigerian oil and gas industry content development act, 2010. Content development nogicd act in 2010 to promote local content development throughout the sector.
The policy is designed to build the capacity of indigenous firms and to provide more opportunities for participation in business. Fabrication and integration of all fixed offshore and onshore platforms. Tied to national agenda chairman governing council is member of fec and direct report to president. 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. Nnpc restates commitment to local content realnews. Nnpc, ncdmb to grow nigerian content to 70% by 2027.
Countries can encourage local content through requirements and targets written in national laws. Ncdmb act as facilitator, bringing together a broad array of. Local content development in the nigerian oil and gas. However, the establishment of the nigerian national petroleum corporation nnpc, a state owned and controlled public company in 1977 by act, refocused local content in nigeria.
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