NCDMB identifies moribund steel industry as drawback on local content initiative

Funso Olojo |

The Nigerian Content Development and Monitoring Board (NCDMB) has disclosed that Nigeria does not have an efficient iron and steel industry which is responsible for a huge foreign exchange the country spends on importation of iron and steel that is being used in the nation’s oil and gas industry.

NCDMB however advised the federal government to revive the nation’s iron and steel industry to boost local content and oil and gas production in the country.

The Executive Secretary of NCDMB, Engineer Simbi Wabote disclosed this in Lagos in a paper he presented at a sensitisation seminar on Local Content Development in Shipping, Oil and Gas Logistics Operations in Nigeria, organised by the Maritime Reporters Association of Nigeria (MARAN).

Speaking through a representative Dr. Ginah Ginah, NCDMB General Manager, Corporate Communication and Zonal Co-ordination, the NCDMB boss who enumerated many achievements recorded by the organisation noted that lack of production of steel locally was among the challenges slowing down oil and gas industry from recording the expected growth.

Wabote maintained that non-passage of the Petroleum Industry Governing Bill by the President and high cost of production have pushed back investors from investing their money in the sector, saying that production of oil and gas in Nigeria is the costliest in the world which has made the minister of petroleum called for reduction in costs of oil and gas exploration.

‘’Our country does not have an efficient steel industry and everything in oil and gas industry requires steel. Nigeria is losing a huge foreign exchange to importation of steel.

Steel used in the industry is imported; government has to do something to revive iron and steel industry. Local content in the sector will jump to 50 percent if we produce steel locally,’’ he said, noting that most of the pipelines transporting petroleum products are damaged not by militants but because many of them are old having been established many decades back.

Wabote noted that the industry is confronted with shortage of research institutes as most of the oil and gas researches that are being used to develop and carry out exploration were carried out abroad.

He said that most of the Nigerian universities that could have produced manpower for the industry are running outdated curricular which has made their products inadequate to take rightful positions in the industry.

According to him, oil and gas industry is a specialized industry and NCDMB is in the process of establishing research institutes that will be domiciled in four universities in the country and also in discussion with the National University Commission on the review of curricular of petroleum studies.

He noted that the establishment of the research institutes would save the country foreign exchange being spent on researches abroad.

To mitigate the impact of all these challenges on the growth of the industry, Wabote informed that the organisation had set aside 200 million dollars as Nigerian Content Intervention Fund (NCIF) and domiciled with the Bank of Industry which the bank would give out as loans to local investors at an 8 percent interest.

He added that the essence of the NCIF is to save the industry from foreign dominance and provide fund to empower and boost capacity of Nigerian participants in oil and gas production. He expressed displeasure that the disbursement of the loan by Bank of Industry was very slow as only three stakeholders had benefitted.

Earlier in his welcome address, Mr. Anya Njoku, President of MARAN, noted that the essence of the seminar was for stakeholders to exchange ideas on how to revive complexities associated with local content operations in shipping, oil and gas and operational logistics.

Njoku maintained that it is very important for the country to take over operations in these sub-sectors to enable Nigerians make gains of these sub-sectors while calling on Armed Forces – Army, Navy, Police and even Customs to work in line with the Nigerian constitutional provisions and standards set by the International Maritime Organisation (IMO) and other international organisations on how to conduct smooth commercial shipping and logistics in the nation’s sea and waterways.