Local content in oil, gas industry has grown tremendously — Shell MD

The Managing Director, Shell Petroleum Development Company (SPDC), Mr Osagie Okunbor, on Tuesday said that local content in the Nigerian oil and gas sector has grown tremendously in the past decade.

Okunbor made the assessment while giving an oil and gas industry message at the ongoing 10th Practical Nigerian Content Conference and exhibition in Yenagoa.

In the overview, Okunbor recalled that in 2020, the oil and gas industry celebrated with the Nigerian Content Development Monitoring Board (NCDMB), the 10th anniversary of its establishment and the enactment of the NOGICD Act.

He observed that the successes of the Act in just 11 years was exceptionally commendable.

According to him, many strides have been made in developing domestic capacity in the country and there are so many success stories to that effect.

He listed the leaps recorded to include the Egina Project executed by TotalEnergies, which was attested to by the NCDMB to have realised over per cent in Nigerian content.

He noted that the project set new industry benchmarks for a project of its size and magnitude.

“Egina enabled the domiciliation of new capacities and facilities in-country one of which is the FPSO integration facility located at the LADOL Free Zone.

“This feat by Total Energies added to the pool of jobs in-country and enabled capital retention.

“Also SPDC Limited in 2016 spent more than N2 billion in the construction, upgrade and provision of equipment for the Nigerian Institute of Welding in a bid to enhance welding technology in-country.

“With this investment, the institute is now able to perform destructive and non-destructive testing of materials.

“Another laudable project was the establishment of three world-class pipe-mills in-country for the manufacturing of Helical Submerged Arc Welded line pipes. This was a first in Nigeria.

“ExxonMobil Upstream and its affiliates have, since 2006, supported the training of unemployed Nigerian engineers, through its engineering capability development programme.

“This programme has enabled the acquisition of project-based engineering skills, allowing young graduates to acquire relevant training suitable for gainful employment,” he said.

Okunbor further noted that Agip Joint Venture is working with the NCDMB to provide a 15 megawatts power station for electricity to the Nigerian Oil and Gas Park Scheme in Ogbia Local Government Area in Bayelsa.

Okunbor listed Chevron’s human capacity development programme which is focused on dynamic, positioning training, as another commendable effort in building domestic capacity.

According to Okunbor, with the five-year scholarships it provides for this training, Chevron has successfully trained more than 172 Nigerian seamen.

The SPDC MD also listed the launch of a 200 million dollars Nigerian Content Intervention Fund managed for the NCDMB by the Bank of Industry as another commendable initiative.

He said the fund was set up to boost the financial capacity of indigenous companies with loans at very attractive interest rates, which by extension reduces overall project costs.

“It is important to also recognise the successes from indigenous service companies. For example, Dorman Long Nigeria, fabricated the first pressure vessel in-country for the Gbaran Ubie Project.

“Kay-Global, another indigenous service company, is manufacturing fire retardant coveralls in Delta and Rivers States.

“High quality, locally manufactured low and high voltage cables which are now made by Coleman Cables, MicCom Nigeria and KableMetal are also worthy of mention,” Okunbor said.

He called on the entire industry to focus on existing challenges that hamper the effective delivery of Nigerian content aspirations.

Okunbor expressed optimism that with collaborative effort the oil and gas industry could deliver an in-country value addition model, that is worthy of replication globally.

“The theme of this year’s event: ‘Driving Nigerian Content in the New Dawn of the Petroleum Industry Act’ is truly apt and well timed, given the overarching impact of the Act on the industry and the entire energy value chain in Nigeria.

“I am, therefore, looking forward to the in-depth and detailed conversations and discussions that will take place here, over the course of these next few days.

“I implore us all to fully engage, striving for honest conversations and strategic thinking as we discuss pertinent Nigerian content dilemmas and challenges.

“I have no doubts that the outcomes from this forum will provide useful insights for emerging policies and industry guidelines,” Okunbor said.