Wabote refutes financial buoyancy claims, says “1% NCDF remittance on oil, gas contract is dwindling”

…2023 Nigerian Content Level in oil, gas industry holds steady at 54%

…shipping, surveying/positioning services, inspection/testing & certification top NCL performance in 2023

Oredola Adeola

Engr. Simbi Wabote, Executive Secretary, Nigerian Content Development Monitoring Board (NCDMB) has debunked claims that the Board is financially robust, emphasizing that the one percent (1%) Nigerian Content Development Fund (NCDF) remittance on oil and gas contracts is dwindling due to industry challenges.

He however noted that the Board has prudently grown its funds, with 68% placed in intervention funds and the remaining 32% utilized for operations, enabling it to attract yields and capital appreciation while fulfilling its core mandate.

Engr. Simbi Wabote, Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB) made this disclosure during his keynote address delivered at the 12th edition of the Practical Nigerian Content (PNC) Forum, on Tuesday, in Bayelsa State.

According to the ES NCDMB, the remittances from the oil and gas sector have been significantly reduced, with less than 50% of the Nigerian Content Development Fund (NCDF) being recouped. He stated that the decline in remittances is attributed to the fact that many companies in the sector are still failing to meet their obligations.

Speaking on the theme: Deepening Nigerian Content Amidst Divestments, Domestication & Decarbonisation, Engr Wabote, stated that it is false to believe that NCDMB is very buoyant and awash with money.

The NCDMB’s boss noted that our journey on the Board’s 10-year Strategic Roadmap which was launched in 2017, has been transformational from where it started to the point where it is at the moment.

He added that the Board has completed 83% of the 96 initiatives under the strategic roadmap with focus now shifting to the remaining initiatives that require some heavy lifting to bring into fruition.

He said, ” The fact is that the 1% NCDF remittance on contracts awarded is dwindling due to the lull in the industry. Through prudent and judicious use of the fund, we have grown it to a sizable amount such that it could be leveraged for intervention and our operational needs.

“The Fund has 68% of it placed with BOI and NEXIM Bank as intervention funds and 32% utilized for our partnerships. These placements have enabled us to attract some yields and capital appreciation while still fulfilling our mandate,” he said.

In his last Practical Nigerian Content (PCN) keynote address, Engr. Wabote, highlighted the importance of reflecting on the 54% Nigerian Content Level achieved in 2023, as it signals a potential inflection point leading to a decline in the oil and gas industry’s Nigerian Content level.

He said, “From where I sit, as the ES of NCDMB, I see some disturbing signs pointing to that direction and I believe we can counter these emerging dynamics as this is not the first time, we have faced such an onslaught on local content practice.

“I am sure you all know that getting the industry to this level of Nigerian Content is not a walk in the park and I believe all discerning stakeholders in the industry will play their part to prevent us from going back to the dark days of implementing Nigerian Content as a token of consolation,” the NCDMB’s boss said.

Engr. Wabote, emphasized the importance of not losing sight of the connection between high Nigerian Content levels and relative peace in the oil and gas industry in the country.

He said, ” The nexus between high Nigerian Content levels and the relative peace in the industry must not be lost on us.

The NCMDB boss announced that the 2023 Nigerian Content level in the Nigerian oil and gas industry is 54% based on our monitoring and evaluation of industry activities. This is similar to the 54% NC level achieved last year.

He said, “Once again, this performance is well above the minimum target of 47% NC set for 2023 by the Board’s Project Management Office (PMO) just like we outperformed the 42% NC target set for 2022 by achieving 54% Nigerian Content.

“Further analysis of the 2023’s National Content level performance shows that the top 3 performers of in-country spend are Shipping, Surveying/ Positioning services, and Inspection/ Testing and Certification with each at 100% NC level.

“On the other hand, the bottom 3 performers are Modification and Maintenance at 26% NC level; Health, Safety, and Environment at 31% NC level; and Materials and Procurement at 32% NC level.

“In more than seven (7) years of being in the saddle, we have managed to adapt our workstyles and initiatives to derive the support of our principals and various stakeholders.

“We have also enabled their various programs and policy initiatives such as 7 Big Wins, Economic Sustainability Program, Year of Gas, Decade of Gas, and several others.

Engr, Wabote, therefore, emphasised that the success achieved by the Board, would not have been possible without the endorsement and approval of its top management committee, Tenders Board, Ministerial Tenders Board, Governing Council, Bureau of Public Procurement, National Assembly, and the Federal Executive Council.

He said, “Time flies; it is imperative to finish off initiatives met on the ground, aim to finish what you started, and pass the rest to the next dispensation for completion.”

Wabote further highlighted the significance of momentum and the importance of utilizing timely decisions to sustain it, warning that a lack of momentum can lead to a halt in progress and the need for extra efforts to restart the process.

He submitted that the Local Content growth is directly proportional to its being prioritized as a national agenda, adding that once there is a lack of leadership backing at all the Nigerian Content levels, it opens the door for the practice to take the back seat.

“Needless to add that this has its consequences which are not usually immediate,” Engr. Wabote cautioned the Nigerian Government.