Presentation by S. A. Shehu, Registrar, Computer Professionals Council of Nigeria (CPN) at the Stakeholders meeting on IT Local Content in the Oil and Gas sector held on 5th February, 2014 at NITDA, Abuja.
1. Nigeria is the largest oil producer in Africa and the eleventh largest in the world, averaging 2.5 million barrels per day, with proven reserves of over 35 billion barrels and is currently the 5thlargest exporter of crude oil to the United States of America with oil revenue making up over 90% of Nigeria’s foreign currency receipts.
2 Despite this impressive profile, however, the Nigerian oil and gas sector’s contribution to national GDP has been minimal. According to energy reports in2008, the sector accounted for less than 38% of national GDP. This has been a direct consequence of the noticeable absence of indigenous participants in the industry given that over 80% of the goods and services needed for projects were being imported from foreign countries.
3. Furthermore, for the greater part of the last four decades, the Nigerian oil and gas industry has been dominated by major international oil companies with large numbers of expatriate workers being deployed to carry out projects in various onshore and offshore locations in the country. This preponderance of expatriate workers has resulted in paucity of jobs, skills development, capacity building &utilization for the indigenous workforce and in the long run, a lack of sustained national economic development.
4. In recognition of this deficiency, the Federal Government of Nigeria has in the past made efforts to domesticate a significant portion of economic derivatives from the oil and gas industry by encouraging the development and deliberate utilization of Nigerian human and material resources in the Nigerian oil and gas sector. Such efforts led to the formulation of a number of local content friendly policies in the oil and gas industry; the enactment of the Nigerian Content Act 2010. This Content Act takes precedence over all existing content laws and regulations and was enacted with the aim of providing for the development of indigenous content in the Nigerian Oil and Gas Industry by ensuring that priorities are given to indigenous services companies.
5. Local Content means the quantum of composite value added to, or created in the Nigeria economy through a deliberate utilization of Nigeria human and material resources and services in the upstream and downstream sectors of the Nigeria Petroleum Industry, which includes all activities connected with the exploration, development, exploitation, processing, transportation and sales of Nigerian crude oil and gas resources, without compromising quality, health, safety and environmental standards.
6. The Act in recognizing the importance of ICT to the Oil and Gas sector specifically in section 58(f) of the Act; directed the Nigerian Content Development Monitoring Board (NCDMB) to set up Nigerian Content Consultative Forum (NCCF) in ICT. It is worthy to note that in the above section; the NCCF in ICT is required to consist of stakeholders, government and regulatory agencies in the ICT industry.
7. In line with the directives of the above section, NCDMB has called for meetings between it and the stakeholders in the ICT industry with the aim of setting up the Nigerian Content Consultative Forum (NCCF) in ICT but stakeholders have not been able to present one front which led to the decisions taken at the last meeting held in November 2013 which required stakeholders in the ICT industry to come together and register a platform/consortium/association that would be recognized by the NCDMB.
8. There abounds great opportunities for IT practitioners in the industry, the schedule to the NOGCID Act outlined IT services required in the sector and they includes:
i. Network Installation/Support Services
ii. Software Development and Support services
iii. Computer Based Modeling Services
iv. Computer Based Stimulation/ Training Programmes Services
v. CAL/CAP Services
vi. Hardware Installation Support Services
vii. Operating System Installation / Support Services
viii. User Support/ Help Desk Services
ix. IT Management Consultancy Services
x. Data Management Services
xi. Telecommunication Installation / Support Services
xii. Data and Message Transmitting Services
xiii. Public Address System Services
xiv. Other Information Systems, Information Technology and Services
xv. Rental of Telecommunications lines
xvi. Telecommunication Subscription Services
9. According to the NOGCID ACT, Section 12 precisely, Nigerians are to be given first consideration for the provisions of goods and services in the sector, also in the schedule to the Act, Nigerians are permitted to perform certain percentage in the provision of goods and services in the oil and gas sector.
10. From the above, it is clear that the Government has clearly established its intention to increase indigenous participation in the industry in terms of human, material and economic resources. It is high time the IT industry seize these opportunities in the Oil and Gas sector.
11. Challenges to harnessing opportunities in the Oil and Gas sector:
i. Presenting a common platform for all IT practitioners in the country in the sector.
ii. Sensitizing of IT practitioners of the opportunities in the sector
iii. Registering all IT practitioners capable of providing services in the sector on the Joint Qualification System (JQS) which is the databank of available capabilities in the oil and gas industry.
iv. Negotiating considerate terms for accessing IT contracts in the sector.
v. ICT human capacity building in the sector
12. Imperatives to accessing opportunities in the Oil and Gas Sector:
i. Creating a common platform for all IT practitioners, desiring to provide IT services in the oil and gas sector.
ii. Compilation of a directory of persons with capability to provide IT services in the sector
iii.Creating platform for information gathering and sharing among IT practitioners.
iv. Promoting use of locally created softwares and hardwares in the sector.
v. IT capacity building in the sector
13. In conclusion, there is no doubt that the passage of the Content Act has set Nigeria on the path towards achieving sustainable development of the nation’s economy through the stimulation of industrial development, growth of local capabilities, building of a skilled national workforce and the creation of a competitive supplier base.
14. To achieve the laudable aims of the Act however, it is vital that relevant government agencies responsible for the development and regulation IT/ICT to continually collaborate and work together with stakeholders in the industry to ensure the effective implementation and enforcement of the provisions of the Act.
15. I strongly believe that coming together of all stakeholders in the IT industry will act as catalyst to harnessing the abundance opportunities in the Oil and Gas industry and lead to specialization in the IT industry which would enhance ICT human capacity building in the Oil and Gas sector.
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