THE wrangling in the oil and gas sector involving the operations of the Nigerian Development Content Development and Monitoring, NCDMB, may either abate or worsen in the coming days. President Bola Tinubu on Thursday, May 9, appointed Ekperikpe Ekpo, minister of State for Petroleum Resources (Gas), as co-chairman of the Governing Council of the NCDMB. Before this, Senator Heineken Lokpobiri, minister of State for Petroleum (Oil), has been the chairman of the governing council since December 7, 2023, when the governing council members were inaugurated. The Nigerian Oil and Gad Industry Content Development (NOGICD) Act provided for only one chairman who is the the minister of petroleum. President Bola Tinubu is the de facto minister of petroleum with two ministers of state for oil and gas respectively.
Since the inauguration, NCDMB has not known peace due to the interference of Lokpobiri in the administration of the NCDMB, which has been causing a confidence crisis in the sector. This manifested when he kicked against the posting of some staff by Felix Ogbe, new executive secretary of the NCDMB, stating that the latter breached the NOGICD Act.
Lokpobiri’s latest aspersion has been on Simbi Wabote, the former executive of NCDMB. He alleged that the NCDMB under Wabote made bad investment decisions and put over $500 million of the industry’s fund in equity investments in private establishments and in loans that are now non-performing at a dinner at the Petroleum Industry Club, Ikoyi, Lagos in April. Also, Lokpobiri cited the Atlantic Refinery in Brass, where $35 million was made at once against the disbursement threshold. The minister added that not even a block has been put on that site at the Brass Fertiliser Plant, where he alleged that $20 million was spent in an “empty field” without due process. He added that there was malfeasance in the issuance of loans from the $350 million NCF Fund in the custody of the BOI, adding that 90 percent of the loans given out by the NCDMB are non-performing.
Contrary to the minister’s noxious comments, the NCDMB told Realnews that there was no disbursement threshold. Realnews gathered that the NCDMB board invested in four refineries and all the disbursements were done in a single tranche, adding that the WalterSmith received $10 million, Azikel, $20m, Duport, $15m, while Atlantic got $35 million (disbursed in two tranches of $21.5 million, and $13.5 million). Twenty million dollars was disbursed and invested in Brass Fertiliser along with NNPC, which invested over $20 million. Brass Fertiliser is seeking debt finance and financial closure for an over $2 billion project.
The NCDMB also denied that any malfeasance was committed in disbursing the loans, adding, that NCDMB/BOI funds remained: “Best loan scheme so far in Nigeria. No non-performing loan. Repayment is consistent.”
The evidence of the performance of the loans is shown when the Waltersmith Modular Refinery paid a dividend of N450 million to the NCDMB out of the N1.5 billion the company declared in 2023. This represents NCDMB’s 30 percent share in the company for the year ended 2023.
Before this feat, Lokpobiri at the inauguration of the WalterSmith Refinery in November 2023, commended the NCDMB and the company for supporting the Federal Government’s agenda of improving domestic refining capacity. During a facility tour of Waltersmith Petroman Oil Limited, Ibigwe, Ohaji-Egbema Local Government Area of Imo State on Tuesday, November 21, 2023, Lokpobiri commended the NCDMB for investing in Waltersmith Refinery to quickly facilitate the completion of the modular refinery.
He added: “The quickest way to fix our energy challenge in the country should be through modular refineries, while we await the total rehabilitation of the big refineries.” The 5,000-barrel per stream day Waltersmith Petroman, which has been a stable source of diesel, kerosene, naphtha, and high-fuel oil to the domestic market since its inauguration in 2020, was for him proof of how beneficial such smaller processing plants could be.
Another strategic investment decision that NCDMB made, which the minister flayed, but has yielded a dividend of $1 million on April 17 is in NEDOGAS. Emeka Ene, chairman of the NEDOGAS handed the cheque to Wabote’s successor Felix Omatsola Ogbe, who assumed office in December 2023.
Furthermore, ThisDay newspaper reported that the $50 million Eraskon Lubricant Blending Plant with 128,800 litres per day production capacity being built in Gbarain, Yenegoa, Bayelsa State, has reached a 70 percent completion level. The project is a joint venture (JV) between Eraskorp, which has 60 percent equity, and the NCDMB with 40 percent equity. The project will address the huge gap in lube products consumed in Nigeria, which is mostly imported and depletes the country’s scarce foreign exchange and fuelling inflation.
Another project from the stable of the NCDMB investment is the 156,000 metric tonnes per annum Triansel Gas Limited’s Liquefied Petroleum Gas, LPG, storage terminal in Koko, Delta State.
Construction at the site has reached 90 percent and is expected to be inaugurated by December 2024, to boost domestic penetration of the product in Nigeria. The $25 million Triansel Gas project is a joint venture between its parent company, Chimons Gas Limited, and the Nigeria Content Development and Monitoring Board, NCDMB, at equity stakes of 59.1 percent and 40.9 percent, respectively. NCDMB invested $3.4 million in the project, which Chibuike Achigbu, executive chairman of Triansel Gas Limited, said began in 2021.
There is also AMAL Technologies where NCDMB board invested in after a rigorous process as part of its research and development incubation project to encourage local content. Realnews, as part of its investigation to verify the minister’s allegation, visited Amal Technology Limited in Abuja. Realnews was taken around the company by Shehu Tijani, managing director of the company, who explained the processes of the modern equipment installed for manufacturing gas leak detectors, the original product of the company, has been transformed to produce four other items, including manufacturing online and offline POS machine, electricity meter and smart valve for detecting pipeline leakage and phone charger. At maximum capacity, the company has 300 workers and 50 at minimum, Tijani said.
Already, Amal Technology is geared to produce meters for electricity distribution companies, DISCOS, including the Kaduna Discos under the Presidential Meter Initiative programme. The company plans to go into producing semiconductors, which Tijani said Nigeria needed to do to diversify and attract investments into the country. Amal Technology, which is 100 percent owned by Nigerians, the first of its kind in Nigeria, was nurtured for five years by the NCDMB, which invested 35 percent of the N5 billion investment with a five-year moratorium for repayment. According to Tijani, Amal Technology will pay off the loan in the next two years. Amal Technology with its unique product has attracted the attention of international and regional bodies and organisations that want to partner with it to transfer the technology they have developed to other African countries. According to Tijani, APPO, 10 countries in Africa that attended the African Organisation for Standardisation Summit and others want to partner with Amal on technology transfer. Amal Technology is also warming up to pay its dividend and even pay off the loan it received from the NCDMB, according to the managing director. “Having seen all I have shown in the Amal office, would you consider the investment a waste?” Tijani replied when Realnews asked him to comment on the minister’s allegation. He added that the company went through a very rigorous process to qualify for the NCDMB research and development incubation centres supported with a repayable loan which was not a grant. “So, I think that if the honourable minister was able to attend the inauguration in person, I think his views would have been totally different at least for Amal Technologies because what we are doing, we are not only just breaking barriers, we are pace setters, we are the leader in the industry,” he said.
Other industry watchers share Tijani’s view, especially when the Executive Order 001, EO1, Compliance Report compiled by the Presidential Enabling Business Environment Council, PEBEC, gave NCDMB a clean bill of health. The PEBEC’s latest report covering January to December 2023, released in April 2024, showed that the NCDMB came first in efficiency and transparency rankings among the ministries, departments, and agencies of the federal government.
According to PEBEC, NCDMB scored (70.07 percent) to be first while the Standards Organisation of Nigeria, SON, got 69.5 percent to be second. Also, in October 2023, PEBEC, for the second time, named the NCDMB as the best Federal Agency in transparency and efficiency in business and continued its streak of excellence in the delivery of its mandate. In the 2023 Half Year Executive Order 001 Compliance Ranking, which covered from January to June 2023, NCDMB scored 83.06% to clinch the top position in the federal government’s ranking of ministries, departments and agencies, MDAs, the second straight year it clinched the award.
The sterling performance of the NCDMB has fetched the organisation some national and international recognition such as the Leadership Local Content Champion of the Year Award at the 14th Leadership Conference and Awards held at the International Conference Centre, Abuja.
The award was presented to Wabote by Mohammed Musa Bello, the minister of the Federal Capital Territory, at an event that was chaired by Vice President Yemi Osinbajo, with Raila Amolo Odinga, former Kenya Prime Minister, as the guest speaker.
Some of the reasons the executive secretary was selected for the award included completing the 17-storey Nigerian Content Tower within three years, raising the level of Nigerian Content performance in the Nigerian oil and gas industry from 26 percent in 2016 to 52 percent in 2022, and developing the Nigerian Content 10-year strategic roadmap, with the key target of achieving 70 percent Nigerian Content in the oil and gas industry.
The NCDMB under Wabote also established hubs in-country for manufacturing of equipment, components, and accessories required by the industry and for championing the promotion of local content across the African
Other notable recognitions received by the Board recently included the conferment of the Distinguished Capacity Development Award received by Wabote from President Muhammadu Buhari in October 2022 and the recognition accorded to NCDMB as the best among all ministries, Departments, and Agencies in the Executive Order (EO1) performance ranking for Ease of Doing Business from January to June 2022.
These recognitions justified Lokpobiri’s earlier praise for the NCDMB’s investment decisions.
Thus industry watchers are baffled by his recent castigation of the NCDMB and this prompted people to think that there is more to it than meets the eye.
Indeed, a bird’s eye view of the minister’s grouse against NCDMB was provided in Wabote’s statement in April alleging a N30 billion budget padding request by the minister’s emissary, which he turned down. The statement recalled that the former Executive Secretary’s travails began over budget padding disagreement, which Realnews surmised led to his untimely replacement before his tenure expired.
Having succeeded in removing him, the minister appears not still satisfied and unable to sheath his sword notwithstanding the damaging effect his comments have on the fragile investment in the oil and gas sector, which has declined with the attendant divestment by some international oil companies due to inclement business environment. This atmosphere could worsen confidence in the sector should the leadership continue vitriol like that of the minister of petroleum (Oil), especially with the two ministers of state serving as chairman and co-chairman of the NCDMB governing council. The NOGICD Act provides for a chairman for the Governing Council, who is the minister of petroleum. Tinubu is the minister of petroleum, but he inaugurated…..
This article written by Maureen Chigbo/Realnews is published in two installments. Click here for the concluding part