• Sunday, July 14, 2024
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$3bn Egina FPSO fabrication, integration yard at LADOL attests benefits of local content initiative


Companies in the oil and gas including maritime industries, have continued to reap the benefits of the local content development act of 2010, which have enabled them to not only grow the volume of their infrastructural investments, but to also create employment and wealth for Nigerians.

Lagos Deep Offshore Logistics Base (LADOL) has through the opportunity created by the content act, succeeded in building the over $3 billion Egina floating, production, storage and offloading vessel (FPSO). FPSO is an offshore production facility that house both processing equipment and storage for produced hydrocarbons. It is a ship-shaped vessel, with processing equipment, or topsides, aboard the vessel’s deck and hydrocarbon storage below in the double hull. After processing, an FPSO stores oil or gas before offloading periodically to shuttle tankers or transmitting processed petroleum via pipelines.

Speaking at the just concluded Offshore West African conference held in Lagos last week, Jide Jadesimi, executive director, business development of LADOL said that the company through the help of local content act has developed a $600 million facility in the Lagos Free Trade Zone, located opposite Lagos harbor.

According to him, the local content act has been of a great benefit to LADOL and has contributed to the success of the company. “For instance, the development of FPSO fabrication and integration yard, which is over 60 percent completed, has been driven from inception by local content. Through local content, we have been able to start building a critical infrastructure in our facility that will become a legacy to our future generations.”

The project, he noted, will enable LADOL to create about 5,000 direct and 50,000 indirect jobs. “Currently, we have about 1,000 employees on ground including thousands of indirect jobs created so far in our base.”

On the impact of the declining crude oil price, Jadesimi, disclosed that the company has succeeded in building strong business model that rides on flexibility and efficiency. “Therefore, whether the oil price is high or not, it does not affect our business model.”

“We are actually a more attractive cost saving solution to bigger International Oil Companies (IOCs) because it is same kind of efficiency when oil was over $100 per barrel that we offer to them till date that oil is below $30 per barrel. This is because big IOCs want to do things differently; they want to save cost and efficient service delivery. So, we provide that in addition to fast turnaround time and the strategic location of our facility,” he explained.

To consolidate the benefits of Local Content in the West African sub-region, Kwaku Boateng, director special services, Petroleum Commission of Ghana, said countries in the region need to partner in areas like movement of experts and capacity development including transfer of skills, research and development among countries.

Boateng, who noted that local content implementation in the region, is mainly national base with no emphasis on regional integration, said that going forward, success would be measured by countries ability to leverage the local content strategies in conjunction with domestic and foreign stakeholders.