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Local Content Development and Enforcement Bill 2020

 Rt. Hon. Legor Idagbo Proposes Two Bills On Local Content Development, Facilitates Completion of Oil and Gas Park in Odukpani.

 

The House of Representatives Member representing Bekwarra/Obudu/Obanliku in the Green Chambers, Rt. Hon. Legor Idagbo proposed two bills on the floor of the green chamber; the Local Content Development And Enforcement Bill and Nigerian Oil and Gas Industry Content Development Act (Amendment) Bills.   

Both Bills have scaled through second reading in the floor of the house.

Rt. Hon. Idagbo is the House of Representative Committee Chairman, Nigerian Content Development and Monitoring.

The bills when signed into law will rejig the Nigerian economy, diversify it from Oil and Gas and create jobs for Nigerians.

Recently also, in order to boost the Local Content, the Federal Executive Council (FEC) approved N2.923 billion contract for the provision of infrastructure for the manufacturing of Oil and Gas components at Odukpani, Cross River State.

Briefing reporters after the virtual FEC meeting in Abuja, the Minister of State for Petroleum, Chief Timipre Sylva, said the total contract sum of N2,923,480,976.70, including tax, was awarded to Messrs Kinetic Electro-Mechanical Limited with the completion period of 15 months.     Sylva, who said the project would serve as an additional infrastructure facility for the manufacturing of oil and gas components in the National Oil and Gas Park, added that upon completion, the project would boost capacity in the oil and gas sector, provide job opportunities for Nigerians and boost economic activities in Odukpani.

The oil and gas park in Odukpani is a project under the Local Content Development sector and Hon. Legor Idagbo as Chairman of the House Committee on Nigerian Content Development and Monitoring is facilitating the completion of the park.

As part of his oversight functions, the Chairman Nigeria Content Development and Monitoring, Rt. Hon. Legor Idagbo had gone on an inspection tour to the site of the Oil and Gas Park and had subsequently engaged with contractors handling jobs at the park.

As a follow up, meetings were held with the Nigeria Content Development Board and other stakeholders primarily to see to the continuation of work in the park and possible completion .

The recent approval of the contract is thus part of the continuing effort and the Chairman of the Committee on Nigerian Content Development and Monitoring is committed to seeing that the work at the park is taken to its logical conclusion, for the benefit of Cross Riverians.

 

Rt. Hon. Legor Idagbo

 

A Review of the bills

BILL TITLE – NIGERIAN LOCAL CONTENT DEVELOPMENT AND ENFORCEMENT BILL 2020 

SPONSOR – Rt. HON. LEGOR IDAGBO

STATUS OF BILL – SCALED SECOND READING

BACKGROUND AND OBJECTIVES OF THE BILL –     The proposed bill seeks to consolidate on the gains made in implementing Local Content in the Oil and Gas industry pursuant to the enactment of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act 2010, and also provides the legal basis for enforcement of Presidential Executive Orders 003 and 005 on local content signed by President Muhammadu Buhari GCFR.

The gains so far made as a result of the enactment of NOGICD Act 2010 is record breaking. Nigerians have greatly increased their expertise in petroleum exploitation and now extend their businesses to neighbouring countries. Trillions in naira terms have been saved as a result of local participation in the oil and gas industry. Presently, Nigerians are involved in so many sub-sectors of the Nigerian Petroleum Industry as a result of strict monitoring of the activities of companies that before the coming into effect of NOGICD Act 2010, usually ignore local labour and materials in the exploitation of our petroleum resources.

Extending the local content requirements beyond the petroleum industry to some other critical sectors like ICT, Manufacturing, Agriculture, Power, Solid Minerals, Construction, Health etc is now imperative as the country must look inwards to assert and ensure her economic independence especially in light of the current COVID-19 induced global economic scenario which makes it imperative for countries to look inwards for economic growth and sustainability.

 

SOCIO-ECONOMIC BENEFITS OF THE BILL –        

The highlights of the provisions of the bill and expected socio-economic benefits are herein outlined below: 

1) Promotion of local manufacturing and economic diversification with focus on ICT, Agriculture, Solid Minerals, Hydrocarbon Refining, Power and Manufacturing;


1.a) Provision for incentives to encourage local processing of hydrocarbon resources, export of processed mineral and agricultural commodities, local manufacturing of equipment, machinery, spares, chemicals, ICT hardware, development of software etc.

1.b) Provision for standardisation of locally made goods and locally sourced raw materials to make them competitive in the international market.

 

2) Preference for Nigerian goods and services in all public procurement;


2.a) Nigerian content philosophy as a key requirement in all public sector procurements.

2.b) Provision for creation of local content departments in all MDA’s

2.c) Requirement for Nigerian Content Plan (NCP) on major projects (above N100 million) outlining minimum Nigerian Content threshold for labour, materials and other services required on the project site.

2.d) Nigerian content requirements in solicitation of bids

2.e) Requirement for Nigerian content compliance certificate as a pre-condition for contract awards.

2.f) Creation of Nigerian Content Committee to develop economic wide local content policy.

 

3) Creation of a robust R & D ecosystem to drive home grown technology development: 


3.a) Provision to promote collaboration between Research Institutions, product developers and end users of research.

3.b) Provision to incentivise funding of research by public and private sector entities.

 

4) Job creation drive to address unemployment: 

4.a) First consideration for Nigerians with requisite skills in all public funded projects.

4.b) Provision to create national data base of available skills.

4.c) Requirement for approval and utilisation of expatriates to only roles where there is immediate skills shortage.

 

5) Capacity building to develop resilient local supply chain: 

5.a) Provision for targeted sector-specific capacity building programmes.

5.b) Requirement to close capacity gaps in education, infrastructure, facilities and vendor development on the back of projects.

 

6) Sustainable funding for Local Content: 


6.a) Provision to create a Nigerian Content Trust fund dedicated to implementing projects and programmes connected to developing local content.

6.b) Application of the fund to develop SMEs through low interest project-based financing schemes.

 

The enactment of the – Nigerian Local Content Development and Enforcement Bill will further strengthen Executive-Legislative synergy and oversight on local content administration in key sectors of our economy. It will also provide necessary legislative backbone for implementation of key initiatives that will evolve from Presidential Economic Sustainability Committee as well as other policy actions by the Executive aimed at repositioning the Nigerian economy post COVID-19.

 

BILL TITLE – Nigerian Oil and Gas Industry Content Development Act (Amendment) Bill, 2020.

SPONSOR – Rt. HON. LEGOR IDAGBO

STATUS OF BILL – SCALED SECOND READING

Some of the highlights of the bill include –

1. Creation of a Nigerian Content Council to be head by the Vice president

2. Deduction of 2% from every contract awarded in nigeria for the development of local content

3. Ensuring that no expatriate is allowed to do a job in Nigeria that can be done by Nigerians and where they exist a gap there must be modalities to bridge that gap thereby creating jobs for our teeming population in nigeria.

4. Building capacities of local companies not only to compete in Nigeria but also abroad.

5. Ensuring the patronage of made in Nigeria goods.

 

This bill is intended to amend the Nigerian Oil and Gas Industry Content Development Act (NOGICD Act. 2010) by expanding its scope to capture changes in the industry.

 

 

 

 

 

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