Stakeholders reaffirm need for local solutions to challenges in Africa’s oil and gas industry

Stakeholders and policy leaders in Africa’s oil and gas, have stressed the need for Africa to look within for solutions to problems in the face of global economic challenges. 

This was conveyed at the third edition of the African Local Content Roundtable holding in Abuja between October 25 and 26 2023 with the theme “Fostering Local Content In Africa for Africans,” jointly agreed that the concept of local content is not merely a policy, but a catalyst for transformation.

Setting the context at the Pan-African engagement, Simbi Wabote, the Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), noted that one of the greatest challenges bedevilling the African oil and gas industry is local manufacturing of components.

“90 percent if not more of the equipment that we use are imported because we’ve not focused on how to manufacture some of the components in-country,” he said.

While noting that “the importance of developing homegrown cost-effective affordable and scalable solutions to address local challenges cannot be overemphasised,” the NCDMB boss identified prioritisation of research and development as well as funding as key to delivering local content goals on the continent.

He therefore called for robust engagements on quality service and equipment manufacturing, cross-border partnerships, intensive out-of-the-box thinking and improvement of funding sources or leveraging additional funding sources to overcome the funding challenges of oil and gas producing countries.

“The time for change is now and it is our collective responsibility to usher in a new era of local content development and implementation in Africa’s oil and gas industry.”

“The NCDMB stands as a key advocate In local content development not just in Nigeria but Africa as a whole.”

Similarly, Omar Farouk, secretary general of the African Petroleum Producers Organization (APPO), lamented that Africa has continued to be dependent on foreign oil and gas technologies despite being in the oil producing business for nearly 100 years and making billions from oil and gas projects.

“We have sadly been conditioned to believe that such dependency is normal. More alarming is the fact that the African continent has the highest proportion of its population living in energy poverty with over 600 million Africans living without access to electricity and millions of others living without any access to modern energy. 70% of the oil we produce is exported. 70% of the gas is also exported,” Farouk said.

“Africa must be allowed to use its affordable and readily available source of energy mainly oil and gas. Today’s developed countries used it to get to where they are today, we must be allowed to also use it to lift the living conditions of our people and get them out of poverty.”

While challenging stakeholders to take advantage of the roundtable in addressing the legitimate concerns, Farouk assured of APPO’s commitment to changing “the pathetic situation.”

On his part, Heineken Lokpobiri, Nigeria’s minister of state for petroleum resources (oil), expressed that the theme of this year’s Roundtable – ‘Fostering Local Content In Africa for Africans’, is very appropriate for Africa to evolve from not just supplying raw materials, but developing capacity and capability to explore, produce and process its hydrocarbons resources into petroleum derivatives for its own use.”

He commended the NCDMB, APPO and Heritage Times (HT) for organising the roundtable which he said “aligns with the renewed hope agenda of President Bola Tinubu that is anchored on positioning the Nigerian economy to look inward for goods, services and manpower needs of strategic sectors of the economy.”

Also speaking at the event was Mele Kyari, the group chief executive officer (GCEO) of the Nigerian National Petroleum Company Limited (NNPCL), who stressed the need for Africa to prioritise and promote local content development in all aspects of operations.

According to him, “Africa must ensure a future where it is driving the technological advancement and innovation that is tailored to address our peculiar challenges. The continent must also ensure a just energy transition in line with climate change objectives. This means we must begin to empower local businesses, create jobs and add value to our economies beyond what we have done in the past decade. Therefore, this is a call to a commitment to utilising our own resources, expertise and workforce to maximise the benefits of our energy sector.”

Kyari who was represented by Muniru Mai, chief innovation officer NNPCL, said the state oil company “understands the importance of local content and have made it the centre of our operations, we are committed to achieving the highest level of local content in all of our projects from upstream exploration to downstream activities.”

Stakeholders went on a visiting tour to the Nigerian National Petroleum Company (NNPC) Research, Development and Innovation Centre in Abuja.

The tour saw stakeholders observe the need for the centre to double its effort in forging partnerships, collaboration and cooperation with African peers with a view to delivering on local content goals in the oil and gas industry. They also assured the centre of providing any support it needs to help foster local content in Africa’s oil and gas industry.

A visiting tour was also paid to Amal Technology, a gas leak detector production facility. Notably, the company is a project that was instituted and supported by the NCDMB.

The tour allowed stakeholders to evaluate the impact of the NCDMB in initiating and catalysing the growth of indigenous oil and gas companies.

The 3rd African Local Content Roundtable was hosted by the NCDMB, with APPO as strategic partner, and the Heritage Times HT as facilitators.