Local content: Boost to indigenous capacity in oil, gas industry

By Adewale Sanyaolu

before the enactment of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act of 2010, which became law on April 22, 2010, and giving birth to the Nigerian Content Development and Monitoring Board (NCDMB), the Nigerian oil and gas industry was dominated by International Oil Companies (IOCs), including briefcase businessmen, who relegated indigenous operators to the background.
But the implementation of the NCDMB, according to stakeholders, has increased the number of technology-driven workspaces and capacity building by indigenous contractors who originally could not compete with foreign contractors.
The board is saddled with the responsibility of increasing indigenous participation in the oil and gas industry, building local capacity and competencies, creating linkages with other sectors of the national economy and boosting industry contributions to the growth of the country’s national Gross Domestic Product (GDP).
But stakeholders, especially the Petroleum Technology Association of Nigeria (PTAN), an association of indigenous oilfield service companies in the upstream and downstream sectors of the oil industry, have consistently attested to the contributions of the local content law in boosting capacity of indigenous operators for the growth of the sector.
Contributions to economy
NCDMB said the country may have saved about $380 billion that would have left it through capital flight and job loss of two million in the oil and gas sector with implementation of the Local Content Act since more than 95 per cent of the jobs in the industry were done offshore.
According to the pioneer Executive Secretary of NCDMB, Mr. Ernest Nwapa, $214 billion worth of procurements and $9 billion worth of research and development were done in North America, while $78 billion worth of technical services and $39 billion worth of engineering works were carried out in Europe.
But with the implementation of the Act, he said $191 billion investment could be retained in-country while 300,000 new direct job opportunities are expected in areas of engineering, sciences, technical services and manufacturing.
Nestoil blazing the trail
Over the past two decades, Nestoil Limited,  a subsidiary of the Obijackson Group and a leading indigenous oil company into Engineering, Procurement, Construction and Commissioning (EPCC) services affirmed its industry leadership through execution of technically complex projects, which have contributed to the efficiency of its clients in the oil, gas and energy sectors of the Nigerian economy.
Speaking with Daily Sun on the sidelines of recently concluded Nigeria Oil and Gas (NOG) Conference, the Assistant General Manager (AGM), Group Business Development, Mr. Simeon Tor-Agbidye, stated that a subsidiary of the Obijackson Group – Energy Works Technology Limited, recently delivered nine Oil Loading Terminal buoy (OLT) anchor mooring piles for the Egina field development by Total Upstream Nigeria Limited.
The completion of the $15 billion Egina field will add 200,000 barrels of oil to Nigeria’s daily production, making the Obijackson Group a part of history in the development of Nigeria’s oil and gas sector.
“We have completed scope for that project and a few weeks ago, we had a sail off for the OLT piles for the project. We sailed them off to South Korea where they will be integrated on the FPSO. We have finished that.
“We are at the final stages of completing K2s pipeline for Shell Petroleum Development Company (SPDC). We are also progressing smoothly with the pipeline. The project is an engineering, procurement and construction contact for the 40km x 20 inches export pipeline to re-route Kolo Creek gas to Soku Gas Plant.
Furthermore, he noted that, “we are also progressing smoothly with the OB3 pipeline. Obiafu/Obrikom–Oben is an EPC contract for the 64.5km x 48 inches gas pipeline project. We will soon complete that too. The scope of OB3 was actually split between Nestoil and Oilserv,” he said.
He said one of the major achievements the company accomplished on the project is being able to surmount the challenges of the terrain.
“Coming from the West, we had some of the most difficult terrains crossing several rivers. We have crossed these rivers successfully with the innovative horizontal directional drilling (HDD) technology. Our subsidiary, NestHak HDD Limited is an expert in the technology and only company in Nigeria that has 100 per cent success in the job,” Tor-Agbidye said.
The General Manager said there is no need for any company to give pipeline contract to foreign companies today because the company can do everything on pipeline. He added that there are other dimensions to this, including laying pipelines on land, which, he said, is different from laying pipelines in the swamp and also different from laying pipelines in deep offshore, assuring that Obijackson Group has the capacity to do all that.
Baywood
On its part, Baywood Continental Limited (BCL), a wholly Nigerian-owned integrated oil and gas technical service company, has expressed the readiness to bid for marginal fields as well as matured oil fields from IOCs.
The President and Chief Executive Officer, Baywood Group, Mr. Chris Baywood-Ibe, told Daily Sun that the company has made massive investments in all key sectors of its operations in order to sharpen its competitive edge and reinforce its leadership position as a major engineering, procurement and construction company.
According to him, BCL is the first to have engineered, designed and constructed the largest onshore gas pipeline in Nigeria for Total Exploration and Production.
“This project being BCL’s flagship under Oil Mining Lease 58 Upgrade Obite-Ubeta-Rumuji is a 42” x 46km gas pipeline, a major artery supplying gas to Alaoji power plant for power generation to the grid as well as gas supply to the NLNG.
“Additionally, the BCL is first to carry out river crossing through horizontal directional drilling of the  largest bore pipe of 1km crossing through Sambrero River.
“It is a record-setting feat in the Nigerian oil industry by an indigenous company. We provide service support for all the major IOCs in Nigeria such as Shell, Total and Chevron, and have won many industry-relevant awards in technology and safety.”
He said to date, the company had achieved over 30 million man-hours with zero fatality while providing cost-effective and fit-for-purpose solutions for projects in challenging onshore and offshore locations.
The Baywood president said the company had been positioned for optimal growth while maintaining profitability with a staff strength of over 1,000, comprising some of the most experienced and competent personnel in the industry.
“The future for Baywood Continental Ltd is extremely exciting and we are looking to upscale our operations, especially marginal fields, acquisition of matured oil fields from oil majors and explore new frontiers in the energy sector such as cluster power generation using abundant gas for upcoming new cities and towns,” he said at a press briefing in Lagos.

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