Pdf towards sustainable local content development in the. Foster measurement and implementation of local content. Local content development newsroom seplat petroleum. Development policies and programmes university of calabar press. Pdf a novel concept, local content, in oil industry is gradually emerging. Local content broadcast in nigeria is meant to be a means through which the mass society experience culture. An overview of the nigerian oil and gas industry local. Local content development in the nigerian oil and gas industry local content development is critical for countries like nigeria that are rich in natural resources but whose oil and gas sector has traditionally operated in isolation from the rest of the economy, thereby allowing minimal participation from local citizens in its development. Implementation of local content in nigeria in a related development, the senate of the na, in september 2016, mandated its committee on petroleum upstream and gas to conduct a public hearing to investigate the implementation of local content in nigeria, with a view to determining the degree of compliance with the nogicda by industry operators. Nigerian content development fund the atact estblihtablishes a ni inigerian cttcontent dl tdevelopment fdfund managed by the board and funded through a 1% deduction at source of every contract awarded to any operator, contract, subcontractor, alliance partner or any other entity in any ppjroject. Pdf a conceptual model for local content development in. Countries that adopt local content as a development strategy for their extractive sectors usually start by developing local content frameworks policies and laws.
The nigerian oil and gas industry has developed, focusing on increasing indigenous participation in the industry. What matters when it comes to adopting local content. The board shall implement the provisions of the bill with a view to ensuring a measurable and continuous growth in nigeria content. An important consideration is the journey local content development has taken in the context of the ogm sector in theory and practice. Best practice for local content development strategy. Nigerian oil and gas industry content development act, 2010. In nigeria, researchers assessed the enabling environment for private sector. A paper commissioned by revenue watch institute social funds in peru, korpela, 2009, makes. Local content meaning in the cambridge english dictionary. Nigerias story of local content interventions in the oil industry. The role of local content policy in local value creation in. The profiles are intended as a tool for policy makers, researchers and citizens seeking to understand and compare how local content is dealt with in other countries, and to provide some examples of language that might be adopted in a framework to achieve local content goals. Local content policies offer exciting new potential for economic development in nigeria by encouraging economic activity, value addition, and job creation. Nigerian content monitoring board the act establishes the nigerian content monitoring board the bdboard whi hhich is theregultlatory agency vestdted with the responsibility of regulating local content.
The nigerian oil and gas industry content development act the act is designed to enhance the level of participation of nigerians and nigerian companies in the countrys oil and gas industry. Ncdmb and the implementation of the ncdf 1% tax local. Local content development in the nigerian oil and gas industry. Engie africa has announced the successful acceleration of the access to energy a2e strategy that it launched in 2018, thereby establishing its position as market leader on the continent. March 2017 recent developments on nigerian content law in. Nigerian content or local content is the equivalent of local value added to the development, design, fabrication and assembling of ict products in nigeria measured in monetary terms as a proportion of production cost or the proportion of indigenous manpower involved in the various stages associated. Petroleum local content and local participation regulations, 20 in exercise of the power conferred on the minister responsible for energy by section 22 of the petroleum commission act, 2011 act 821, these regulations are made this 5th day of july, 20. Abstract the petroleum industry in nigeria is the largest industry and mean generator of gross domestic product gdp in the west african nation. The case of sierra leone summary 3 pages a changed context for local content with the current downturn in the global markets for oil, gas and minerals, and slower global growth more generally, the role of local content regulation needs to be rethought. Local content in oil, gas, and mining world bank group. Local content policy, human capital development and sustainable business performance in the nigerian oil and gas industry james unam monday1 1 department of management and accounting, obafemi.
Measures to stimulate the use of local content in the extractive sector can be grouped into three main categories. In addition, local content and other policies designed to increase incountry value have a dual nature ovadia 2012. Guidelines for nigerian content development in information. Local content policy in nigeria started in 1971 through the establishment of the national oil company noc to promote the indigenisation policy in the oil and gas sector. The nigerian oil and gas content development act of 2010 has provisions to.
Local content development is critical for countries like nigeria that are rich in natural resources but whose oil and gas sector has traditionally operated in isolation from the rest of the economy, thereby allowing minimal participation from local citizens in its development. The passage into law of the nigerian local content bill is one of the significant developments for domesticating the oil and gas industry through local value additions to the local economy. Promotion of linkage development is essential to enhance the contribution of the oil and gas industry to the macro economy. Noc became nigerian national petroleum corporation nnpc in 1977. This c4dbased online collaboration platform connects policy makers, companies, academics and practitioners, to share and create knowledge around local content development in the extractive industries. The nigerian oil and gas industry content development act 2010 was therefore signed into law on april 22 nd 2010 and aims to increase indigenous participation in the oil and gas industry by prescribing minimum thresholds for the use of local services and materials and to promote the transfer of technology and skill to nigerian labour in the. Local content regulation as a differentiator for inward investment in africa. Local content policy, human capital development and. Local content is the value that an extraction project brings to the local, regional or national economy beyond the resource revenues. Every nigerian citizen young or old possesses a unique potential, this can only be better used depending on the awareness of opportunities.
While a welldesigned local content framework is a valuable starting point, there are other factors that can shape their successful implementation aoun and mathieu 2015. For local communities, decent mining company jobs that are safe, stable and fairly compensated. The nigerian state has been faced with various economic, social, political, educational, and development problems in all sectors of the nigerian economy. Local content development is critical for countries like. Nigeria that are rich in natural resources but whose oil and gas sector has traditionally operated in isolation. The nigerian oil and gas industry content development act. March 2017 recent developments on nigerian content law in the. Inspite of the huge financial investment made by the nigerian government in the oil and gas industry of. A serious attempt was, however, made in 2010 with the promulgation of the nigerian oil and gas development. Pdf the nigerian state has been faced with various economic, social, political, educational, and development problems in all sectors of the nigerian.
Local content in nigeria the guardian nigeria news. One of the first steps in this charge is to develop robust real local content local content referring to homegrown labour, services and resources, all things that nigeria has in swathes but. Overview of the nigerian oil and gas industry content. The shell nigeria exploration and production company snepco, says its local content strategy was built around the national framework as developed by the.
Thus, the focus of this paper is to briefly explain the local content act and its implication on tvet and the nigerian economy. Stimulating direct local employment executive summary when a mining company arrives in an area, the promise of local employment is central to public debate in leastdeveloped, developing and developed countries alike. However, community development is the process or effort of building. Local content and procurement requirements in oil and gas. Recent experiences suggest that especially in newly designed local content policies, there is space for improvements in order to be effective. Maximize participation of nigerians in oil and gas activities.
Why local content in africas extractive sector wont work. First, instruments are designed to encourage sourcing of. The targets for lc policy in increasing local content development were set progressively. Linkage development can facilitate technology transfer and economic diversification. The current climate of the industry has largely been influenced by the. Training and employment connects the local communities. Unctad commissioned an overview of local content regulatory frameworks in selected eccas countries in the oil, gas and mining sector as part of united nations development account project 1415p. Petroleum exploration, development and production local content regulations, 2014. The role of local content policy in local value creation. The extractives for local content development community of practice. The execution of these initiatives will go a long way towards the attainment of the objectives of the boards 10year strategic roadmap, one of which is to achieve 70% local content by 2027.
Many nigerians directly or indirectly linked with the oil industry all let of a sigh of relief as the new law was widely expected to create more opportunities for. The nigerian local content development policy local content policy in nigeria started in 1971 through the establishment of the national oil company noc to promote the indigenisation policy in the oil and gas sector. First, instruments are designed to encourage sourcing of local inputs, with a view to promote upstream linkages. The enactment of the nigerian oil and gas industry development act in april, 2010 was greeted with much fanfare within the circles of nigerian businesses and professionals plying their trade in the nigerian oil and gas industry.
Conceptualizing tvet in most advance economies, industrialization most certainly emanate from tvet kutz, 2001. Countries can encourage local content through requirements and targets written in national laws. Integrate oil producing communities into the oil and gas value chain. The bill received presidential assent on 22 april 2010 and created a law to provide for the development of indigenous content in the nigerian oil and gas. Shell explains its local content strategy for nigeria. The nigerian oil and gas industry content development act 2010 lists targets for progressive increases in local content. Cited in o uchenna, towards sustainable local content development in the nigerian oil and gas. Resourcerich countries are increasingly inserting requirements for local content local content provisions into their legal framework, through legislation, regulations, contracts, and. Overview of local content regulatory frameworks in.
The policy is designed to build the capacity of indigenous firms and to provide more opportunities for participation in business. Nigeria has long experience of local content policy in the oil and gas sector. Local content development in the nigerian oil and gas. Oil and gas news in africa local content development. The local content act defines local content as the quantum of composite value added to or created in nigeria through utilization of nigerian resources and services in the petroleum industry resulting in the development of indigenous capability without compromising quality, health, safety and environmental standards. This is reflected through the nigerian government initiative of increasing local content and ensuring that indigenous companies have a greater part in developing oil and gas assets. In the middle east and north africa, where shell livewire is called intilaaqah, we trained 1,920 participants in 2017 52% of whom were women. Local content is major change from importer to producer will be resisted globally and locally. Strengthening the capacity of the economic community of central african states to. Nigeria has been working to implement local content through a newly created agency, the nigerian content development and monitoring board ncdmb. This is geared to developing and improving local capacity and participation in the extractive industry and the overall improvement of the economy. Drive impacts to host community level nigeria oil and gas industrial parks scheme. Local content ng is designed to aid you better understand and utilize your untapped benefits from local content development in nigeria.
835 1371 796 1087 238 1273 1548 1059 967 1187 307 207 497 1396 577 540 829 1000 616 1003 411 1409 1311 621 1310 404 179 308 1177