Nigeria boosts local content policy, bans importation of barites from 2022

Nigeria will ban the importation of barites in 2022, the Executive Secretary, Nigerian Content  Development and Monitoring  Board  (NCDMB), Simbi Wabote, has said.

Speaking at the launch of made in Nigeria barites in Port Harcourt, Rivers State, yesterday, the NCDMB boss in company of the Minister of Mines and Steel Development, Olamilekan Adegbite; the Minister of State for Mines and Steel Development, Dr. Uche Sampson Ogah and the Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele, said Nigerian barites meet specifications for use in the oil and gas industry, mostly in drilling operations.

He hinted that imported barites would no longer be allowed for use by the Nigerian oil and gas industry from 2022. He expressed delight at the alignment of objectives by the Ministry of Petroleum Resources and Ministry of Mines and Steel Development in supporting the attainment of the aspirations of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act. 

Wabote stated that the utilisation of locally produced barites and drilling fluids in the Nigerian oil and gas industry was in line with the Federal Government’s commitment to the optimisation of local content and diversification of the Nigerian economy, adding that it would create huge value addition and opportunities to drive the sustainable and competitive growth of the Nigerian economy. 

He recalled that the Board had issued a guideline in May 2021 where it approved four firms for the supply of barites required for any drilling project or contract in the Nigerian oil and gas industry.

The Board, he said, also listed 10 other companies that would be upgraded to Category A NCEC as soon as they meet the requirements of the guideline for the utilisation of locally produced barite and drilling fluids in Nigerian oil and gas industry.

The Executive Secretary charged the ministry and barite miners to focus on the improvement of the health and safety practices at the mines, optimal barite production in volumes and to the required specification and availability of accurate geological data. 

He also emphasised the need to address host community issues and environmental practices leading to land degradation, provision of adequate infrastructure and logistics, improved access to financing for equipment and working capital and patronage and utilisation of Nigerian barites by oil and gas operators and service companies.

Wabote stated that improvements in these areas would positively impact the sustainable development of the Nigerian barite value chain, assuring that the Board would continue to collaborate and protect investors in the entire value chain of the Nigerian oil and gas industry.

The Central Bank of Nigeria (CBN) Governor, Emefiele, who spoke virtually at the event, commended the Ministry of Mines and Steel Development and other stakeholders for positioning Nigeria to join the league of barite-producing nations.

Emefiele, who was represented by his Special Adviser on Development Finance, Mr. Anthony Ifechukwu, said he was particularly excited about the launch because it would ultimately translate to substantial foreign exchange earnings for the country.

Emefiele said: “Barite is a raw material that is very vital to the development of the Nigerian oil and gas sector. Among several other uses, it plays an essential role as a weighting material in drilling muds used in oil and gas drilling primarily to prevent the explosive release of gas and oil during drilling. In addition, its use has long been established in the plastic, rubber, cosmetic, pharmaceutical, paper making and paint industries.

“I am particularly excited by the fact that the product we are launching today is called the “Nigerian Barite.” In his remarks, the Minister of Mines and Steel Development stated that the launch would end decades of importation of barites, affirming that the barites being launched met the API standards, which is the global specifications demanded by the oil industry.

He stated that Nigeria was blessed with 47 solid minerals deposited across the country, adding that barites were among the seven strategic minerals prioritised by the ministry for development.

Adegbite also announced that the Ministry of Mines and Steel Development would set up a marketplace portal that would connect all stakeholders in the barites value chain to a hub that allows easy coordination, stocking, effective costing and seamless sale of barites. 

He added that the ministry would coordinate the process and ensure that appropriate revenues from the process were remitted to the government.

He explained that the launch of made in Nigerian barites would create jobs, increase revenue to government through royalty payment and conserve foreign exchange spent previously on importing barites.