NCDMB Enforces Stringent Criteria for Oil Service Companies to Bolster Local Content
The Nigerian Content Development and Monitoring Board (NCDMB) has announced that it will not approve oil service companies that lack the proven capacity to execute projects. This statement underscores the critical nature of the Presidential Directive on Local Content Compliance Requirements, which aims to enhance competitiveness and mitigate risks associated with unqualified contractors.
Speaking at the Nigerian Oil and Gas Energy Conference in Abuja on Wednesday, NCDMB Executive Secretary Felix Ogbe emphasized the importance of excluding intermediary entities lacking the essential capacity to perform from the Nigerian Content Plan. He stressed that only contractors meeting the legal definition of Nigerian companies and demonstrating the ability to execute projects within Nigeria would be approved.
“Entities acting solely as intermediaries, with no demonstrable capacity to execute projects or activities, shall not be approved,” Ogbe asserted. He assured stakeholders that the board would continue leveraging its existing processes to assess and verify company capacities through in-country capacity audits conducted in collaboration with relevant stakeholders.
Ogbe also highlighted that operators in the oil and gas industry would be permitted to source capacities outside Nigeria only after identifying in-country capacity gaps. “The pre-qualification and technical evaluation phases of tender opportunities will be used to eliminate entities identified as incapable of performing,” he stated. International participation will only be considered when the necessary Nigerian content level is unavailable or inefficient locally.
Reaffirming the board’s commitment, Ogbe said the NCDMB would ensure that services provided generate value within Nigeria. The board is dedicated to evaluating current policies and guidelines to foster the development of indigenous capabilities and prevent the misuse or misinterpretation of these policies.
In a similar vein, the Director of Projects Certification and Authorisation Certificate at the NCDMB, Abayomi Bamidele, explained that the board had facilitated oil and gas development through its policies, collaborations, and investments. He noted that the number of Nigerian service companies registered on the Nigerian Oil and Gas Industry Content Joint Qualification System had grown from about 1,000 in 2011 to 13,000, with the number of operating companies increasing to 120.
Bamidele urged service companies to accept only jobs they have the technical capacity to execute and to avoid the practice of bidding for every job in the industry, thereby ensuring quality and reliability in project execution.
