Hot Source•130 firms benefit from NCI fund as total capital hits $400m
Peter Uzoho
Amid persistent resistance by some indigenous oil and gas producers and contractors to the payment of the statutory one per cent local content levy, the Nigerian Content Development and Monitoring Board (NCDMB) has introduced the Nigeria Content Compliance Certificate System (NCCCS) to ensure adherence to the legal provision.
The certificate, according to the agency, was intended to enhance transparency and boosting local participation in the oil and gas industry in line with Section 104 of the Nigerian Oil & Gas Industry Content Development (NOGICD) Act 2010, which provided for the Nigerian Content Development Fund (NCDF) to fund local capacity development in the sector.
According to the NOGICD Act, one percent of every contract awarded to any operator, contractor, subcontractor, alliance partner, or any other entity involved in any project, operation, activity, or transaction in the upstream sector of the Nigeria oil and gas industry shall be deducted at source and paid into the NCDF managed by the NCDMB for projects, programmes, and activities directed at increasing Nigerian content in the oil and gas industry.
But over the years, one of the challenges in implementing this aspect of the law has been the resistance of indigenous oil mining lease (OML) holders or operators to paying that one per cent levy.
However, speaking at its 2-Day Stakeholders’ Sensitisation Workshop for Community Contractors, held in Lagos, Executive Secretary of NCDMB, Mr. Felix Ogbe, explained that the compliance certificate was a pivotal tool developed to ensure that Nigerian content requirements are fully complied with in all oil and gas projects in the country. Represented at the event by the Acting Director, Finance and Personnel Management, Mr. Mubarak Zuabair, the NCDMB boss added that with the introduction of the compliance certificate, companies now have an objective standard to demonstrate conformity, while the board is better positioned to ensure regulatory oversight.
For the system to be effective, he said, stakeholders must be adequately informed, saying the sensitisation programme provided an opportunity for hands-on engagement and clarification.
Ogbe explained, “This programme is more than a workshop. It is a reaffirmation of our commitment to deepen Nigerian Content in the oil and gas industry and improve transparency, accountability, and access to funding mechanisms that support indigenous participation.
“The Compliance Certificate System was developed to ensure that Nigerian Content requirements are met in all oil and gas projects. With the introduction of the Compliance Certificate, companies now have a clear objective standard to demonstrate conformity, while the board is better positioned to ensure effective regulatory oversight.
“We understand that for this system to be effective, stakeholders must be adequately informed. This programme, therefore, provides an opportunity for hands-on engagement and clarification.”
The NCDMB boss also unveiled the upgraded NCDF payment portal, tagging it a major step forward in the drive for efficiency.
According to him, the enhancements made to the platform were aimed at improving user experience, simplifying remittance processes, and ensuring real-time compliance tracking.
“With the expected increase in inflow to the fund following the implementation of compliance certification, this upgrade could not have come at a better time,” he added.
At the forum, the board also sensitised oil companies and contractors to the revised Community Contractors Finance Scheme, which it called “a bold reimagination of our support for host community contractors.”
It was disclosed that the First City Monument Bank (FCMB) is managing the fund, which offers a N50 million loan to firms to execute projects in host communities. The loan comes with an eight per cent interest per annum.
“Through our collaboration with FCMB and other financial institutions, we have redesigned the product to remove access barriers and increase participation by genuine community contractors.
“This initiative is directly aligned with our strategic objective of enabling shared prosperity and inclusive growth in the Nigerian oil and gas ecosystem,” Ogbe said.
He disclosed that the NCIF has risen to $400 million, adding that the fund has been instrumental in developing local capacity in the industry.
“As of today, about 130 companies have accessed and benefited from this Fund across the various product lines. Work is, however, ongoing to ensure more indigenous companies in the industry have access to the fund,” Ogbe added.
