Contracts awarded by international oil companies (IOCs) and their indigenous counterparts in Nigeria hit $4.5 billion in four months.

The deals, awarded between last January and April, a collation of data shared between the firms and the Ministry of Petroleum Resources sighted by this newspaper, indicated that it was far above the $2.4 billion average cost of contracts during the same period in 2017.

This figures, further checks showed, tallied with the data submitted to the content board through which the statutory one per cent of contract values was remitted to Nigerian Content Development Fund (NCDF).

The remittance by the oil and gas operators in Nigeria into the Content Development Fund (NCDF), the Nigerian Content Development and Monitoring Board (NCDMB) said in a separate document, had hit $117 million mark in the last 16 months.

Forty-five million of this lump sum being the one per cent worth of the $4.5 billion contract was remitted into the fund in just four month.

“In 2017, the board had an inflow, in terms of remittance, of $6 million per month, totalling $72 million in the year,” the document stated. “Between January and April, this year, the total inflow into NCDF was $45 million.”

This remittance was made from contracts by 157 operators within the period under review.

“The NCDF is based on remittance of one per cent of all contracts and the Nigeria Content Intervention Fund (NCI Fund), a pool of the NCDF is being managed by the Bank of Industry (BoI),” the document stated.

“This NCI Fund, which is $200 million, is a pivotal plank of NCDMB that is set up with the responsibility to implement and enforce provisions of the Nigerian Oil and Gas Industry Content Development Act of 2010.”

Besides, the document noted: “It is the practical expression of NCDMB’s efforts to institutionalise financial support for indigenous service companies operating in the oil and gas industry.

Proper operation and utilisation of the fund will help reverse the unhealthy foreign dominance in the sector by empowering local businesses to thrive.”

The financial cover of the NCI Fund is comprehensive.

“It deals with contract financing for Nigerian oil service providers, contract financing for oil and gas community contractors and contract and loan refinancing for service companies that already have facilities with Nigerian banks,” added the document.

This, according to the NCDMB, “gives the fund unique potential for impact in areas that matter. Community contractors, long constrained by staggering amounts required to compete favourably, win and execute profitable contracts on offer by oil companies despite the legal provision for local content participation will now have a system that speaks directly to those concerns in a sustainable manner.

This will empower them as agents of wealth creation and economic growth in their respective communities, both key goals of the local content law that set up NCDMB.

“Besides the size of credit on offer, beneficiaries have repayment period of over five years at eight percent interest rates. At so many points, the NCI Fund is a social as well as economic development tool that will create sustained impact in boosting local manufacturing, creating jobs, enhancing local technical capacity and igniting economic growth first in the local communities in the Niger Delta and Nigeria.”

The IOCs alone repatriated $14.4 billion, being 72 per cent of total annual in-country spending, from Nigeria in 2017.

The board, under the leadership of Executive Secretary, Simbi Wabote, the document read, is rigorously pursuing a 10-year action plan, which would, through domiciliation, force this repatriation down to $6 billion by 2027.

“Within seven and half years of Nigeria Oil and Gas Indigenous Content Act (NOGIC) in operation, we now have 28 per cent retention of $20 billion in-country spending by international oil companies (IOCs). And this has reduced the repatriation and bring up retention by over $5 billion,” the NCDMB board said.