The oil and gas sector received a boost as the Nigerian Senate passed a bill to amend the Nigerian Oil and Gas sector Content Development Act 2010 for second reading.
In the process monitored on Tuesday, the house said the passage would boost local content and strengthen the nation’s economy.
The Bill, sponsored by Senator Teslim Folarin of All Progressive Congress (APC), Oyo Central was read for the second time.
During the debate at the chamber, he noted that the bill seeks to amend 38 Sections of the extant Act while new sections were subsequently introduced.
Folarin explained that the reason behind the Bill amendment was to make the provisions of the sections to be amended into congruence with sector best practices maintaining that the Nigerian Oil and Gas Industry Content Act, passed in 2010 was meant to address the then abysmally low level of the local content in the oil and gas sector geared towards creating a regulatory mechanism to monitor and enforce compliance by the sector operators.
The amendment he further claimed, was also to help domesticate substantial part of oil and gas exploration and production activities within the country.
According to him; “you will recall that before this Act came into force in 2019, over ninety percent of the $20 billion spent yearly in the Nigerian oil and gas industry was repatriated abroad.
“This was because a large chunk of the contracts were executed by foreign companies and in foreign facilities with only few indigenous players and facilities participating in the contracting process in the industry, Nigerian content was less than five percent”.
He hinted further, that with the enactment of the Act and the establishment of the Nigerian Content Development and Monitoring Board (NCDMB), the citizenry have also developed the capacity to carry out a lot of onshore upstream activities.
“There has been a boost in the promotion of indigenous participation and the fostering of technological transfer as reflected in appreciable local growth.
“Only recently, one of Nigeria’s indigenous oil servicing firms established a 100 million fabrication plant in the Niger Delta region.
“The implementation of the Nigerian Content Fund by the Board has also facilitated the provision of capital and financial support to several indigenous companies,” Folarin said.
He pointed out that the amendment to Section 11 as captured in the new Bill, would empower the Minister of Petroleum to review the minimum target level for Nigerian content set in the schedule where the level is considered beyond the capacity of Nigerian companies by the board.
He, however, posited that the amendment proposed to Section 33 of the Act would streamline and strengthen the process for obtaining expatriate quota to close the gap for current leakages and manipulation by foreign firms.
“Amendments to Sections 37, 38 and 39 in the bill are to improve the provisions relating to research and development and to ensure proper implementation, while Section 76 is proposed to give the Governing Council of the Board the role of Superintending over the conditions of service of employees of the board.
“Section 81 was also introduced to empower the Senate to screen and approve nomination of the Executive Secretary of NCDMB before confirmation.
Meanwhile, Senator Olamilekan Solomon Adeola of APC, Lagos West said the amendment is long overdue even as he prayed for it’s success.
“The Nigeria Oil and Gas Industry Content Bill should now be Nigeria Industry Content Development Act.
“Now that we have succeeded in trying to see that local content has come to stay in the oil and gas sector, it is time for us to move to other line sectors which include manufacturing, ICT, construction and other sectors of the economy.
“The main objective of this particular Act, is for two things: for Domestication and Domiciliation. That is the reason ab initio, the local content was set-up,” Adeola said.
The bill was later passed on to the Senate President, Senator Ahmad Lawan, to the Committee on Local Content for further legislative work and also told to submit its report to the Senate in four weeks’ time.
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