Demand may push up $200m content fund’s threshold
Bank of Industry
The Nigerian Content Development and Monitoring Development Board (NCDMB), The Guardian learnt, is currently assessing and qualifying the performance of the Fund, after which there may be an upgrade.
It was gathered that some industry players had already complained to the NCMDB, giving justifications for a more robust Fund.
The Director of Planning, Research and Statistics, NCDMB, Patrick Obah, in a telephone chat, said although there had been calls to shore up NCDF, the board was watching the performance of the Fund to see the likelihood of a review.
The Fund aims to increase indigenous participation in the oil and gas industry, build local capacity and competencies; and promote the growth and development of Nigerian content in activities connected with sectors of the Nigerian oil and gas industry.
It is also to deepen the creation of linkages to other sectors of the national economy and boost industry contributions to the growth of Nigeria’s National Gross Domestic Product; and address persistent funding challenges that have hindered capacity and growth of local service providers in oil and gas.
The Fund aims at facilitating the growth of community-based companies in the upstream oil and gas sector; spur productivity and job creation in the oil and gas industry; and attract investment capital into the sector and boost contribution of the sector to Nigeria’s economic growth.
Obah said: “When operators borrow money from the Fund, a minimal interest (single-digit) lower than what commercial banks charge, is payable on the loan.
BoI is the manager of the Fund, and it also executes the lending”.
The spokesperson of BoI, Adiza Olaosebikan, said the bank cannot play any role in increasing the threshold of the Fund, but only ensures its efficient management.
Meanwhile, the NCDMB has announced plans to increase the local content in the oil and gas industry from the current 28 per cent to 70 per cent by 2027.
The key parameters required for sustainable local content, according to the board, include: incentives, capacity gap analysis, research, development and capacity building.