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Huge capital flight worries Nigerian Content Board

The Nigerian Content Development and Monitoring Board (NCDMB) has irked by the high capital flight and harped on the need to revive iron and steel industry to reduce the ameliorate the situation. 

The board explained that the huge capital flight from  the importation of iron and steel used in the nation’s oil and gas industry was responsible for the capital flight.

The revival of iron steel, it said, is important to boost local content and oil and gas production in the country.

The Executive Secretary of NCDMB, Mr Simbi Wabote, said in Lagos in a paper presented at a sensitisation seminar on Local Content Development in Shipping, Oil and Gas Logistics Operations in Nigeria, organised by the Maritime Reporters Association of Nigeria (MARAN).

Wabote was represented by Dr. Ginah Ginah, General Manager, Corporate Communication and Zonal Co-ordination, NCDMB.

"Our country does not have an efficient steel industry and everything in oil and gas industry requires steel.

''Nigeria is losing a huge foreign exchange to importation of steel. Steel used in the industry is imported; government has to do something to revive iron and steel industry. Local content in the sector will jump to 50 per cent if we produce steel locally,’’ he said.

Wabote said that the industry was confronted with shortage of research institutes as most of the oil and gas researches used to develop and carry out exploration were usually done abroad.

He also noted that most of the pipelines transporting petroleum products were weak as a result of many decades of usage and not necessarily damaged by militants.

Talking on how to mitigate the impact of these challenges on the growth of the industry, Wabote informed that the organisation had set aside 200 million dollars as Nigerian Content Intervention Fund (NCIF) and domiciled with the Bank of Industry, which the bank would give out as loans to local investors at an 8 per cent interest.

 He added that the essence of the NCIF is to save the industry from foreign dominance and provide fund to empower and boost capacity of Nigerian participants in oil and gas production.

He expressed displeasure that the disbursement of the loan by Bank of Industry was very slow as only three stakeholders had benefited.

Noting that oil and gas is a specialised industry, he said that NCDMB is in the process of establishing research institutes that will be domiciled in four universities and also in discussion with the National Universities Commission (NUC) on the review of curricular of petroleum studies.

He noted that the establishment of the research institutes would save the country foreign exchange being spent on researches abroad.

He said that most of the Nigerian universities that could have produced manpower for the industry were running out-dated curricular which has made their products inadequate to take rightful positions in the industry.

He enumerated many achievements recorded by the organization and noted that lack of production of steel locally was among the challenges slowing down oil and gas industry from recording the expected growth.

Wabote maintained that non-passage of the Petroleum Industry Governing Bill and high costs of production have pushed back investors.

He also noted that most of the pipelines transporting petroleum products were weak as a result of many decades of usage and not necessarily damaged by militants.

Earlier in his welcome address, Mr. Anya Njoku, President of MARAN, noted that the essence of the seminar was for stakeholders to exchange ideas on how to revive complexities associated with local content operations in shipping, oil and gas and operational logistics.

Njoku maintained that it was very important for the country to take over operations in these sub-sectors to enable Nigerians make gains of these sub-sectors while calling on Armed Forces – Army, Navy, Police and even Customs to work in line with the Nigerian constitutional provisions and standards set by the International Maritime Organisation (IMO) and other international organisations on how to conduct smooth commercial shipping and logistics in the nation’s sea and waterways.