Within a period of three decades, Nestoil group has used the gospel of local content to grow from obscurity to Nigeria’s largest indigenous service providing company, a development that is halting capital flight and building capacity for Africa’s biggest economy.
Before the enactment of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act 2010, also known as the Nigerian Content Act, most operations in the nation’s oil and gas space were executed by International Oil Companies (IOCs).
The glaring lack of technical know-how in-country led to the importation of skills, with the affected expatriates being remunerated in the United States dollar. This cost the country capital flight to the tune of $380billion putting more pressure on Nigeria’s local currency.
Put differently, the dismal contribution of local content to the sector pre-NOGICD was much more painful because the oil and gas sector, which accounted for 90 per cent of the nation’s revenue, contributed less than 10 per cent to Nigeria’s Gross Domestic Product (GDP).
The above narration is changing as companies such as Nestoil Group is demonstrating how local companies can provide bespoke and world-class oil servicing support to the industry, a development that is gradually making Nigeria self-reliant and a net exporter of skills to emerging oil and gas countries, not only in Africa but in other parts of the world.
This development has also translated to more money for the nation’s economy, improvement in local capacity, retention of foreign exchange hitherto spent on the hiring of expatriates, and completing jobs abroad.
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Nestoil’s activities and that of its subsidiaries like IMPAC, B&Q Dredging, Energy Works Technologies (EWT), Hammakopp Consortium, Scorpio Drilling, Neconde Energy, White Dove Shipping Company Limited, Nesthak, Shipside Drydock, and Century Power Generation Limited – is widely lauded in the energy ecosystem due to the extra efforts, it commits to executing contracts for local and international partners.
The company has remained at the cutting edge of the energy revolution in Nigeria through its inclusion of technology into the process, part of which is its conceptualization of the Alternative Evacuation System (AES). This is a means to reduce oil loss due to system shutdowns and crude thefts.
For an indigenous company to deep its feet into the murky waters of the oil and gas sector when it was populated by the IOCs, it was certainly not a mean feat
This is what Nestoil leveraged on, in its 30 years of operation with its over 1,500 employees and has continued to redefine industry standards in the pipeline construction, repairs and maintenance with associate facilities in fabrication, dredging, engineering, design, operations and maintenance engineering, civil engineering, river crossing and shoreline protection.
The company’s repair and maintenance facilities are built with the highest health, safety and environment standards ensuring a safe working condition. The company’s operational strategy delivers competitive prices, short lead times, high-quality workmanship and overall reliability in the service to the clients.
Over 95 percent of its employees are Nigerians which makes Nestoil local content personified among the players in the sector, and it is also a foremost employer of local labour across the value chain of the oil and gas sector.
Like a maxim that says, ‘Do not despise the day of little beginnings’, very inspiring is that Nestoil started as a trading business with its company in Idumagbo Lagos Island, but as it continues to expand, it continued to change offices till its current headquarters, Nestoil Towers on Akin Adesola Street, Victoria Island.
According to Ernest Azudialu-Obiejesi, Nestoil Group Chairman, “when we started understanding the business, it took five years of presentation, to convince the IOCs that a Nigerian company can do this business.”
It is no gainsaying that Nestoil, over the years, had passed through turbulent times and daunting challenges but has raised its head above the waters. For an indigenous company to deep its feet into the murky waters of the oil and gas sector when it was populated by the IOCs, it was certainly not a mean feat.
Nestoil prides itself as the “King of the Swamp” with its involvement in many difficult projects in the Niger Delta terrain. It is about to complete its lot in the OB3 gas pipelines, that has witnessed various setbacks for the Nigerian government.
The pipeline system is a critical component of the Nigeria Gas Master Plan (NGMP) meant to deliver gas from the rich reservoirs in the eastern Niger Delta to the established markets in the west of Nigeria. Part of its scope is the construction of the Obiafu-Obrikom-Oben Gas Pipeline(OB3) under the bed of the River Niger, which is over two kilometres span. This feat has never been done anywhere in Africa.
Its sister company, B&Q Dredging Limited is also working on the second Niger Bridge construction, a major socio-economic highway that is of high impact and value to Nigerians.
B & Q Dredging Limited, established in 1996 provides a range of dredging solutions using its highly experienced and motivated multinational workforce to meet global operating standards.
Its services range from dredging services, reclamation, sand filling and road embankments toward erosion control, shore protection and consolidation. This places the company as the foremost indigenous dredging service provider.
The successful completion of Shell’s mammoth 97-kilometer NCTL pipeline in 2010, delivered a month before schedule, turned out to be the icebreaker for Nestoil and B&Q Dredging as that led to the opening of doors to more indigenous companies.
Its level of success today can be tied to the determination of its founder, Azudialu–Obiejesi, to have business entities that would be wholly Nigerian.
With local content in full swing, there is the fear of local operators not having the capacity to deliver on huge impactful projects. This is the lacuna that Azudialu-Obiejesi was able to fill when he established the company and why he recruits Nigerians with the capacity to develop their country with their skills and expertise.
The dearth in the acquisition of modern dredging technology, expertise in environmental dredging, dredger crew training, pre-and-post surveying, safety and security and industry regulation are some of the challenges that face dredging companies in the country. These are areas the management of B & Q have successfully tackled.
In recognition of its capabilities in the industry value chain, three of the group’s companies, Nestoil, EWT and B&Q were in 2017 identified by the London Stock Exchange out of 300 African companies as companies with a great future for the continent – companies to lead Africa in the next 10 years.
Notably, Nestoil, through its engineering and construction arms, has delivered services to a good number of organisations according to global best practices and that has earned it numerous product and management certifications. It has the ISO-9001/2015 certification and has also moved from ISO-2008 to 2015.
This is why players in the oil & gas sector rever the acumen of Azudialu-Obiejesi and why it 30 years in operation is a big occasion that should be widely celebrated.
The next 30 years will surely be more interesting as the company is set to proffer more workable solutions to the economic development of the country.
