Hon. Emmanuel Okon, chairman of the senate committee on Local Content said during the inspection of a shipyard and fabrication complex operated by West African Ventures (WAV) at Onne in Rivers State that poor patronage of WAV shipyard, fabrication complex and marine facilities belonging to indigenous companies have worsened capital flight in the oil and gas industry.
The committee has said that increased patronage of indigenous companies in the oil and gas sector will help retain around $8 billion annually in the economy and help develop local content in the sector.
In his statement, the visitation and assessment of facilities is for the committee to ascertain the capacity of these companies in other to avoid supporting indigenous companies that actually serves as agents for foreign companies.
The committee said contracts awarded by the International Oil Companies (IOCs) in Nigeria to foreign companies will be revoked if they discover the existence of in-country capacity and capability to execute such contracts by indigenous companies.
He reiterates the belief that companies with huge investment within the country are important employers of labour, who are mostly Nigerians and they should be encouraged to do more.
Okon noted that the patronage of indigenous companies with capacity would boost revenue earnings of the economy, save more money and create more employment opportunities by encouraging investors that have shown credibility and has the capacity in its business.
This company (WAV) is evidently a Nigerian company and by law, it should be considered first by the IOCs, when marine services are required. That’s what the Local Content Act says and the law is not ambiguous but explicit. It says wherever there is a Nigerian competence, there is an in-country capacity and there’s a job, within the oil and gas industry. The law states that the IOCs or whoever is giving out that contract, should first of all give a Nigerian company the right of refusal. Today, IOCs says they are doing local content but I think the best they can do for Nigeria is to patronize indigenous companies like WAV so that they can in turn engage Nigerians teeming unemployed youths,” Okon explained.
He admitted that issues relating to inadequate patronage were a fall out of the global crisis in the oil and gas industry and a deliberate intention by the IOCs not to patronize the companies. Hence, The House of Representatives will oppose and cancel contracts awarded to foreign companies where there is in-country capacity by indigenous companies with huge investment creating jobs locally,” he added.
He emphasized the importance and urgency for government to see how peace can be restored, particularly in the Niger-Delta area where the oil and gas business is going on. For now, the government still have one major source of foreign exchange, and it is the oil and gas business. Peace in this region is also key to the indigenous companies, in other to carry out their business activities and avoid vandalization of their facilities.
“Basically, I think if the environment is okay, if there is peace, militants activities are brought down to the barest minimum, opportunities will now come in for WAV that has the capacity, we have seen it. If a Nigerian company is like this, there is no need calling in foreign companies. However, primarily, let us first see how government can come in to see that there is peace in this Niger-Delta in order to encourage business in the industry,” Okon said.
Source: http://www.thisdaylive.com/