The Nigerian Content Development and Monitoring Board (NCDMB) has released a directive barring oil and gas operators and contractors in Nigeria from importing oil sector equipment into the country without obtaining certification from the Board, with effect from October 1, 2011.
The directive, aimed at strengthening the implementation of the local content policy, was issued by the executive secretary of the Board, Engr. Ernest Nwapa, who also disclosed that Nigeria spent $15 billion yearly on importation of foreign equipment.
“With effect from October 1, 2011, all operators, contractors, vendors, OEMs, suppliers and manufacturers’ representatives shall be required to present a Nigerian content equipment certificate issued by the Board for equipment, system, or packages to be supplied to the Nigerian oil and gas industry,” Nwapa said.
He maintained that the new policy would put an end to the practice where operators placed orders with foreign-based original equipment manufacturers (OEM) with strategies that add little or no value to the nation’s economy.
He further explained that the directive was necessary in order to stimulate the structured establishment of facilities for manufacturing and assembly of equipment and systems required for oil and gas industry, including parts and components for after-sales support.
“To ensure that components and parts of equipment are manufactured locally, the Board has a target to grow the proportion of aggregate spend on procurement of equipment retained in the Nigerian economy from a minimum of 10 per cent with effect from October 2012 to 50 per cent by 2015,” Nwapa added.