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FG adamant on 70 per cent local content in oil, gas by 2027

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Oil field.<br />Source: BusinessPostNigeria

The Minister of State for Petroleum Resources, Chief Timipre Sylva, has said Nigeria will increase local content in the oil and gas sector to 70 per cent by 2027.

Sylva, who spoke at the maiden edition of the African Local Content Roundtable (ALCR), said Nigeria has achieved a significant 35 per cent local content compliance in 2021 from a dismal five per cent in 2010.

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According to him, through the implementation of local content, Nigeria has been able to achieve significant progress in value addition, adding that the country plans to achieve 70 per cent local content compliance in the next six years.

“We have achieved significant growth in local value addition from less than five per cent in 2010 to 35 per cent in 2021 and we have set an ambitious target to achieve 70 per cent local content in the oil and gas sector by 2027,” Sylva stated.

Noting that Nigeria’s success story in the oil and gas industry led to the step to extend local content to other sectors of the economy, the minister observed that the essence of the African Local Content Roundtable was to amplify the benefits of local content to fellow African countries.

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He stated that Nigeria had embraced local content as an economic development model for the oil and gas sector to effectively develop the nation’s abundant hydrocarbon despots.

While lamenting the lack of benefits from hydrocarbon production in Africa to the desired economic growth in the continent,

The minister said: “While over 15 African nations are producing and exporting crude oil, the sad reality is that our people have not benefited maximally from this natural resource, either because we have not managed the proceeds optimally or we failed to domesticate the core operations of the industry”.

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Sylva called on African countries to use the opportunity of the parley to initiate conversations around local content, share success stories, challenges and come up with policies that would deepen local participation and domiciliation in their respective countries.

He added that one of the pathways for this desired collaboration and cross-country development is the African Continental Free Trade Area (AfCFTA).

He continued: “It is imperative that African oil-producing countries and their companies cooperate closely in developing and sharing capacities and capabilities to optimize the hydrocarbon deposits and achieve economic growth and development.

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“It makes better business sense to partner with an umbilical producing plant in Angola, or a bolt manufacturing company in Niger republic instead of going all the way to the United States and Norway for the same products. We must take firm decisions and develop policies and projects that would position our industry competitively and sustain our economy under the emerging energy transition”.

The minister said the government took firm steps in this regard by funding two strategic energy projects in Nigeria, a 10,000 tonnes per day methanol plant and 500 million standard cubic feet per day gas processing plant in Brass, Bayelsa State and the Ammonia and Fertilizer plant in Akwa Ibom State.

The expectations of the Federal Government, he said, was to ensure that “the ALCR will become a signature event, leveraging on the wonderful foundations already built by APPO and rotating among all the African oil-producing countries”.

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