Nigeria: Oil for Everyone

Nigeria: Oil for Everyone

by / Comments Off / 20 View / 7th April 2010

An ambitious plan to share the proceeds of the country’s oil wealth with its people is underway. The Nigerian Oil and Gas Industry Development Bill, also known as the Local Content Bill, would include regulations for the activities of multinationals, bringing more indigenous activity into the sector and addressing issues of unemployment and unrest in the oil-rich region of the Niger Delta.

Acting president Goodluck Jonathan is due to sign the bill into law shortly. Passed by the Senate late last year, it has undergone minor revision but has now been agreed upon by all interested parties.

Under the new legal framework, an entity called the Nigerian Content Monitoring Board will be established and will oversee the supervision, coordination, implementation and monitoring of industry policies and practices. All multinational oil companies will be required to set up local offices in the areas they operate in, offices which will be responsible for management and decision making in the relevant areas. The awarding of licences for new exploration and business would also be geared to give initial consideration to local independent companies and service providers.

To tackle unemployment issues, more Nigerians will be required to be involved in training programs and hiring activities. Oil industry operators would have to undertake and report on training and employment programs, providing information on numbers of employees hired and their residential status at time of hiring. Operators will also be required to submit ‘succession plans’ for jobs not held by Nigerians, which will involve Nigerian workers acting as understudies to foreign workers for a period, after which they would take over the positions in question. In order to protect the interests of investors, however, a provision of five percent employment will be retained for management positions.