…Nigerian Content Act boosts capital retention in-country – Nwapa
ExxonMobil Nigeria joined the league of other international oil companies in ameliorating the funding plights of vendors and industry operators when it recently launched its Contractors’ Finance Scheme in Lagos. Giving his remarks before formally launching the scheme, the Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Engr. Ernest Nwapa acknowledged the joint effort of the industry to accommodate the changes that the Board has been pushing following the inauguration of the Nigerian Content Act 2010 by His Excellency, President Goodluck Ebele Jonathan describing it as a major plan of Mr. President’s vision to build an economy that can take care of the welfare of Nigerians.
This, the Executive Secretary disclosed, is no mean task owing to Nigeria’s uniqueness as one of the most populous and vibrant, demanding nations in the world. He stated that, “it is now popularly known that the law we have makes more Nigerians participate in the oil and gas value chain than a few years ago. Today, we are getting more work done in Nigeria with Nigerians working in the industry either on their own or in partnership with foreigners”.
Engr. Nwapa who noted that one of the key things to this venture is access to capital which has made several opportunities available through the scheme. He added that banks would traditionally shore up funds with high interest rates dissuading Nigerian contractors from accessing capital but an initiative like the finance scheme will surmount the hurdles contractors face in the execution of their contracts. He further mentioned the contribution of 1% of all contract sums to the NCDF by operators and contractors in the upstream oil and gas sector of which 30% of the fund is used for direct intervention by the Board while 70% is for Nigerian contractors to access that will add value to the industry and create jobs.
While lauding the proactive support for contractors, Engr. Nwapa reiterated that funding to build facilities and acquire assets is key to providing manufacturing capacity and training. He also stated that the Nigerian Content Act seems to put more capital in the hands of Nigerians and to retain a certain percentage of their income in Nigerian banks. “It is expedient on contractors to begin to know the requirements of banks and to ensure that payment plans are properly structured to suit their investments”, he asserted.
The Nigerian Content helmsman specially congratulated the Managing Director, Mark Ward and his team for continuously improving ExxonMobil’s response to the requirements of the law and the aspirations of government. According to him, by embarking on this journey with the Board, the company is again demonstrating that they understand the importance of carrying Nigerians along in the business. He hoped that ExxonMobil having started this program will support the growth of the business and modify the process as the need arises.
In his introductory remarks, the Managing Director and Country Chair, ExxonMobil Nigeria, Mr. Mark Ward said the scheme is an initiative that seeks to support various national content aspirations, part of which is to afford ExxonMobil contractors better funding options to fulfill contracts awarded to them. This, according to him, also underscores the company’s three tier of national content development whose elements consist of workforce development, strategic community investments and local supplier development which he mentioned is a key foundational problem.
The Managing Director and Country Chair observed that partnering with 12 leading Nigerian banks, it is their expectation that the $8.6billion available on the scheme ExxonMobil contractors nationwide will be able to have access to a better, less expensive and quick refunding options to enable them execute the contracts quickly which in his words: “This clearly is a win-win for all involved”. He added that the contracting community is to see that cash flows freely into their hands and the company gets to see quicker results that will be beneficial to all parties.
The company’s chief executive noted that the cooperation and support that has greeted the scheme has proved absolutely viable to its successful roll-out and expressed appreciation to the stakeholders for the support. “Since the scheme was introduced in November 2013, 24 different contractors have been able to access the funds on the scheme as ExxonMobil continues to encourage additional folks to sign up as the program is launched”, he narrated.
Mr. Ward further noted that there are two easy accesses to very competitive options as well as reduced loan processing time which should ultimately enhance the speedier completion of the contracts, obviously building contractors’ capacity, also helping the company achieve its business objectives quicker and contributing to the national economy.
He concluded his remarks by formally commending NCDMB and the leadership of the Executive Secretary, Engr. Ernest Nwapa for the great support ExxonMobil has continued to receive from the Board. Stressing that without this support, the company would simply be struggling to achieve the kinds of contribution to the scheme whilst also expressing appreciation to the Executive Secretary of the Board for the honor to formally launch the scheme. He prayed ExxonMobil to continue in more years of mutual success to a collective goal in effectively developing national content in Nigeria, the contracting community and the Board which will engender Nigeria’s success to the national content program.
Moving a vote of thanks at the occasion, the General Manager, Nigerian Content Development, ExxonMobil, Mr. Olusola Ogunsakin extolled the Executive Secretary of the Board for being an advocate of Nigerian Content Development and his passionate interest to see that operators adhere to the provisions of the NC Act 2010 and thanked Engr. Nwapa for his support and initiative in most critical times.
He commended his company for the launch to cushion the effect of accessing funds for vendors and contractors with a hint on the overwhelming support on the scheme, hoping that this would increase the assets and human capacity base of the contractors that would be mutually beneficial to ExxonMobil Nigeria.
