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NCDMB’s Search for New Direction

By Gideon Osaka

The enactment of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act 2010 also known as the Nigerian Content Act created numerous opportunities for Nigerians in the oil and gas space, all thanks to a visionary and dynamic agency, the Nigerian Content Development and Monitoring Board (NCDMB) which was a creation of the NOGICD Act. The NCDMB came into existence to drive the effective implementation of the Act through monitoring, compliance and enforcement activities in the Upstream, Midstream and Downstream sectors of the Nigerian oil and gas industry.

Since the establishment of the Board, there has been a systematic and gradual improvement in local content in the industry. Most of the jobs that were executed outside Nigeria are now being performed by Nigerians in Nigeria. This has led to the retention of a large chunk of the industry expenditure in-country, with the attendant positive impact on employment generation, rise of local oil production and exploration companies like Eroton, Seplat, Aiteo, Aradel, Oando, First E&P, the Nigerian Petroleum Development Company (NPDC) all of which have been able to compete with the majors.

There is no doubt that Nigerian content witnessed an extraordinary leap for nearly eight years under the leadership of the immediate past Executive Secretary of the NCDMB, Engr. Simbi Kesiye Wabote who grew local content in the industry from 26 per cent in 2016 to 54 per cent as at the time he left office in late 2023. Wabote’s successes with the NCDMB included establishing a number of highly impactful funds (the $450m Nigerian Content Intervention Fund, the Women in Oil and Gas Fund, $50m Fund for Oil Industry Manufacturing among others); completion and commissioning of the 17-storey NCDMB headquarters in Yenagoa; establishment of high tech pipe mills and in-country pipe coating, enablement of 50% domiciliation of $12bn NLNG Train 7 Project and Modular Refinery Initiative (invested and facilitated the construction and completion of Waltermith’s 5000 barrels per day (bpd) refinery, invested in Azikel Group 12,000 bpd hydro-skimming modular refinery; Atlantic International Refinery’s 2000 barrels plant and Duport Midstream’s 2,500bpd modular refineries). Other achievements include the construction of Oil & Gas Parks Scheme; introduction of Project 100 Initiative; among numerous others.

Wabote raised the bar of local content performance in oil and gas industry, leading to the clarion call for extension of local content to other sectors, where Legislative process at the National Assembly has commenced to extend the practice to construction, power, mines and even ICT. A key enabler to the successes achieved by the Wabote-led management was the 10-year strategic roadmap wherein NCDMB set out to achieve a number of goals by 2027; part of which is the creation of 300,000 direct jobs; retention of $14 billion of the estimated $20 billion spent in the oil and gas industry every year. Indeed, Nigeria through the NCDMB built a reputation embellished with innovation and excellence, which earned the country not just respect, but made it a model for other oil producing countries in Africa. Many African oil producers began a voyage of discovery to Nigeria to learn from the NCDMB how to develop their own local content regulation.

Diminishing hope: No clear direction or strategy six months after

Following the appointment of Felix Ogbe as the Executive Secretary of the NCDMB, the change of guard was greeted with high optimism and expectation by stakeholders in the industry. The optimism stemmed from the fact that NCDMB is one of the agencies under the Petroleum Resources Ministry which has been blessed with quality leadership since inception.

Ogbe’s appointment was deemed to usher in a new era of leadership and vision for the Board, especially in sustaining past achievements and contributing to President Tinubu administration’s target of 70% indigenous content over the period of the president’s years in office.

Expert were anxious to see Ogbe steer strategic national programs being implemented by the Board, to build capacity and domicile industry activities within Nigeria. Bringing his global experience to bear in re-engineering the Board’s business processes to achieve maximum impact, another key task was how the Board under Ogbe’s leadership will foster strategic collaborations and partnerships with both local and international stakeholders.

However, multiple sources who spoke to Valuechain on the turn of events in the NCDMB said almost six months after the Ogbe-led management took office, they were yet to understand the policy plan and strategic direction of the Executive Secretary (ES).

“About things not moving in the NCDMB, I think it boils down to the new ES still coming to terms with the job he has been saddled with. He is still coming to terms with understanding the handover notes that Engr. Simbi Wabote gave him, in terms of what to do with it. When a man does so much like Wabote, anybody who comes after him will struggle to fit into his big shoes,” a source familiar with NCDMB operations said.

“What you see happening at NCDMB is someone struggling to fit into the big shoes that were left by the previous ES, and if you ask me, trying to fashion out his own way forward. So, the Executive Secretary just needs to determine what his own strategy will be, what he will do in his term. See what Wabote has done. How do you take it from there? What will you focus on? How do you redirect the things the man has done to either improve on them or accomplish some of the ones that are close to finishing?  That’s the assignment of the new Executive Secretary. We expect him to quickly come to grips with what his assignment is, and begin to chat a way forward. The same way Wabote came up with the ten-year roadmap. This current ES needs to fashion out what will be in his own pathway so that when he’s done, people will remember him and say, under his time, XZY were done.”

Another industry source who spoke to Valuechain on the impact of the 6-month-old tenure of the new ES, said the agency was very well run for the past seven-and-half years (under Wabote) with a 10 -year roadmap that was well communicated and understood by the industry stakeholders, noting, however, that the industry was unclear if the current ES was going to sustain the roadmap, fine-tune a few areas to make it more effective or introduce an entirely new roadmap. 

“Will there be project reengineering? Will there be change in strategy where necessary? The job of this current Executive Secretary is to create his own direction that will be clearly communicated and resonate with the industry. The 10-year roadmap was Wabote’s mantra for seven-and-half years. Set your own mantra that will not scatter what has happened but accomplish some of the low-hanging fruits and your own new ideas,” the source said.

“You have done nearly six months and internal and external stakeholders are not sure what you are doing yet. We expect that after six months you should have a plan, a clear direction, a clear pathway of where you are taking the NCDMB to; because the last guy took the Board to an admirable level, we don’t expect you to lower the guard, we expect that if you don’t go higher, you stay in that same pedestal,” the source said.

Squabbles with Petroleum Minister

Valuechain reports that, tied to the problem of lack of direction and perceived lull in activities at the agency, is the recent faceoff between the Executive Secretary and the Minister of State for Petroleum Resources (Oil) Heineken Lokpobiri.

Trouble started when in March, the Executive Secretary reversed the redeployment of some Management staff done by the minister. In a swift reaction to the reversal and in what was seen as a show of superior power, the Minister, in a letter dated 5th March, 2024, and addressed to the ES, said the Secretary did not have the authority to overturn deployments/redeployments made by him (as Minister and the Chairman, Governing Council of the Board).

The Minister in the letter, warned the Executive Secretary not to usurp the powers of the Governing Council on any subject matter. “In the light of the above, the redeployments announced by the ES to all staff on 4th March, 2024 is hereby overturned. Consequently, all affected staff should remain in their places of assignment as status quo remains.” Lokpobiri directed. The Minister further explained that the NCDMB management is answerable to the Board led by him (Lokpobiri), and that Ogbe therefore does not have the power to redeploy, appoint or employ management staff.

Insiders who are familiar with the matter said the Minister’s action amounts to meddlesomeness, warning that if the Minister succeeds in cowing the ES, the industry would not take him seriously anymore and would want to refer to the Minister for anything. They said the former ES, Simbi Wabote succeeded in making significant achievements due to less interference from the executive.

 “A part of the Act actually said that the Governing Council needs to ratify managerial approval of appointments. But what the ES did was not appointment, he only reposted staff. So, that is what the issue is,” a source said.

“If the minister writes to say, he is relying on those sections that say the Governing Council needs to approve, alright, is the minister exempted from the Governing Council? or is what the ES did within his powers as just being a regular institutional reposting? So, that is the logjam that both have different perspectives to it.

“Even prior to that, when the ES was appointed, just before he assumed, some changes, realignments and transfers were made in the system. The changes were attributed to the Minister, that the Minister authorized transfers of some directors to new positions and some management staff to new positions.

“And you are wondering who authorized the Minister to make those transfers. Is the Minister now the one that runs an agency? in which place does a Minister directly instruct transfers? That is a total aberration. That happened just on the night of the appointment of the new ES. In other words, he has been aiming to do this, but he couldn’t do it when the former ES (Wabote) was on seat.

“So, he ceased the lacuna that the appointment of the new ES created.  That was the genesis of the problem, transferring around senior management staff, which ordinarily he doesn’t have the powers, because the Minister does not get involved in transferring staff of the Board directly. No ministry or minister intervenes in an Agency to be transferring staff. It is a major aberration. Going from that, he now also tried to get the ES to reverse his own transfer and staff posting,” the source said.

Sources in the Board have therefore appealed to the Minister and ES to sheathe their swords and work together towards sustaining the achievements of the Nigerian content development project, “so that the Board will not suffer the fate of agencies such as NAFDAC where one CEO was successful and the next takes the agency downslide”.