Tough time awaits oil and gas companies that have defaulted in the remittance of the statutory one per cent of the value of contract won by them to Nigerian Content Development Fund (NCDF).
The Nigerian Content Development Monitoring Board (NCDMB) said they would be handed over to Economic and financial Crime Commission for necessary prosecution as soon as the current forensic audit about the companies are completed.
The statutory contribution is meant to be used to deepen local content development in the oil and gas industry and reduce financial challenges most of the companies are facing because of high interest rates from banks. The instutionalisation of the contributory fund has helped to increase to 30 per cent from five percent before the act came to place.
Local companies have been able to access $160 million of the $200million of the fund at about 8 per cent interest rate while more applications are still being processed to enable more companies to have access to the fund.
Simbi Wabote, executive secretary of the Nigeria Content Development and Monitoring Board who disclosed this at the Nigerian Content Seminar organised by CWC, organisers of Nigeria Oil and Gas Conference and Exhibition in Abuja , said the board is determined to fully recovered all outstanding obligations and ensure compliance by companies operating in the country.
He said a lot of things have been achieved by the agency through the contribution of the one per cent of contract sums by some companies.
“Non deductions of the statutory fees, non remittance of the amount deducted at source amounts to mis- interpretation of section 104 of the Nigerian Content Act”, he said.
He said the essence of the conference is to use it as opportunity to zero –in on key provisions of the Nigerian Oil and Gas Content Development Act to reinforce understanding, provides clarifications and use them to serve as additional training outlet for those that are new to the industry or ignorant of the provisions of the law.
He said he had instances where things he thought are very simple and clear in terms of understanding are usually not as clear as he thought or that some people just deliberately don’t want to understand it and try to do anything to circumvent the act itself.
“ To provide further clarity on various events, the Practical Nigerian Content event used to communicate the status of our strategic initiatives under the 10 year road map that is meant to move the industry from the current Nigerian Content level to 70 per cent by the year 2027”
He said the practical Nigerian content event also serve as platform for oil and gas service providers to broadcast their local capabilities and capacities to industry practioners while operators show case their achievements and plans to broading local content practice in line with the law.
The Nigerian Oil and gas opportunity Fairs he explained is a platform to project the various opportunities in the funnel from the green fields to brown fields and from mature to new frontiers thereby providing guides for investment outlook and industry positioning.
Also the speaking in respect of the development of local content in the Nigerian Oil and Gas industry, Kayode Akiode , executive General Manager, Egina close out/Proawei project said there was great deal of local content in Egina development.
He said the Egina production has reached it plateau of 200,000 barrels production per day. This has helped Nigeria to achieve 2.3 million barrels per day production.
Olusola Bello and Frank Uzuegbunam