BoI, NCDMB Signs MoU to Build In-country Capacity for Manufacturing of Oil, Gas Components

Gilbert Ekugbe

The Bank of Industry (BoI) and the Nigerian Content Development Monitoring Board (NCDMB) have signed a Memorandum of Understanding (MoU) to develop local capacity for the manufacturing of oil and gas components and equipment in the country.

The move according to them is expected to increase Nigeria’s 10 per cent capacity in manufacturing oil and gas components, equipment and machinery.

The Executive Secretary, NCDMB, Simbi Wabote, at the BoI/NCDMB signing of the NOGaPs Memorandum of Understanding (MoU) in Lagos, said the partnership has made available a pool of funds to encourage in-country manufacturing, pointing out that the NCDMB and BoI are putting up funds to encourage people to manufacture in Nigeria with an attractive interest rate of 8 per cent. 

“The other fund is to support businesses that wants to establish themselves within the industrial parks that has been built by the NCDMB. We have two of those parks that are almost ready to be commissioned this year. We are in the process of getting tenants into those parks to manufacture oil and gas equipment in the country, so it is highly incentivised in terms of encouraging them to establish themselves, “he said.

He noted that the fund is to encourage in-country manufacturing, maintaining that according data and statistics, over 98 per cent of oil and gas contracts have been awarded to Nigerians.

In his words: “Today, we pride ourselves that almost 98 per cent of the contracts in the sector is given to Nigerians, but when you drill deep into the components and equipment that are used in the industry, the manufacturing capabilities is extremely limited that we cannot even boast of 10 per cent. So, we want to up the game in manufacturing and all it requires is that the business would be domiciled within the park and manufacture within the park.”

According to him, the loan scheme is incentivised with an 8 per cent interest, a one-year moratorium and a 5 year pay back period. 

Also speaking, the Managing Director, Bank of Industry, Oluwakayode Pitan, said so far, over 62 companies have benefitted from the Nigerian Content Intervention Fund (NCIF) $300 million facility disbursed to eligible companies to solve the funding challenge of the local supply chain in the oil and gas industry.

According to him, the beneficiaries went through a risk assessment of the bank and of the Board before the funds were disbursed, saying that the repayment ratio of the fund is close to 100 per cent with all the loans performing.

“All we are looking for are Nigerians who want to manufacture in Nigeria. The industrial parks are of high quality that meets global standards. I want to encourage manufacturers who are looking at the oil and gas sector in particular to go the parks and take space, “he urged.