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Interview with Engr. Simbi Kesiye Wabote, Executive Secretary NCDMB

You recently organized NOGOF 2019 with the title “Maximizing Oil & Gas Industry for the Benefit of the Nigerian People’’. It was a resounding success with more than 1000 delegates. What is the need for such gatherings?

I spent 26 years in the oil and gas industry working for Shell. Before I left to take on this portfolio, I was a director at Shell and I managed at some point in my career local content for Shell, locally and internationally. Locally I drove the general policy for Shell and thereafter Shell decided to give me the responsibility to design a local content strategy for the Group because they discovered that local content is not a Nigerian challenge alone. In the Middle East, even in Europe, local content is a challenge. So, all through that period one thing I saw with the local enterprises and vendors is that they are not given enough information on future project opportunities so that they can prepare themselves so that they can compete more freely. Most of the international companies gain access to this information because of the conferences that are organized globally and their access to most of the multinationals. So, I saw that as a key challenge. That is why any time you send out tenders for projects, the local companies often don’t respond because to them everything is like a surprise. The Nigerian oil and gas opportunity was to share the information about short, medium and long term. We looked at a five-year horizon within all the international companies as well as the local companies, so that local business service providers will be able to prepare themselves for those opportunities that will come in two years’ time. It was a resounding success and we were able to prepare a compendium which today is like a dictionary for them for future opportunities in the oil and gas sector. The first edition was in 2017 and now there is the second edition as some of the opportunities we wrote about two years ago are already ready in the final stages of investment decisions. For example, the e-port project for Exxon Mobil, we talked about them and now they are taking FID. We will do this every two years so we can add the new opportunities.

You talked a lot today about human capacity, how important is it to train your employees and have the same chances as any other expat that comes to the country. How has it changed from the past four years to now?

There has been a significant change to human capacity development efforts. Four years ago, when we took statistics of the skill required in the industry Nigeria fell far short of the skill sets that are needed in this business. So, we begun a deliberate process to start training. Even the economists of older times. Adam Smith and the rest recognized the factors of production, the fact that human capital is vital for achieving the desired objectives. Looking four years back now, I think we have made tremendous progress, particularly dealing with OGTAN training we have been able to refine their processes. When we started, the OGTAN training companies were just middle men who got the training opportunities and took them to Dubai, to London or other places. That was the role they were playing because all trainers were in other parts of the world. But now most of them have been able to build their facilities and to have train the trainer’s programs. Now if they have an opportunity to train, they bring the experts here, into the country and the know how gathers here. So, this is tremendous progress as they build training facilities. Are we there yet? No. There is still room for improvement, we need to tweak and tighten the screw, so they improve their training capabilities.  

How can the NCDMB help potential investors best prepare for coming into this country to operate?

One of the things affected by the local content law was that it gave many international companies trepidations about how they will survive in this new environment. But we looked at the law as a glass half full. We are able to take advantage of the opportunities provided by the law because its intent -if strictly interpreted- is to protect investments in the country. As such, the international companies know that this legal framework is also protecting them if they establish themselves here. Companies manufacturing or producing anything in Nigeria have the right of first refuser. This protects you if you make your investment. It is an encouragement to them to see the bright side of the law. It makes it advantageous if they become the first movers. Those that establish themselves like that can enjoy the benefits. For instance, SAIPEM is an international company, based here in Nigeria, established one of the best fabrication yards imaginable. So, any time a fabrication opportunity comes to us it must involve them. Because they are here! International companies should look at the law in terms of the opportunities it offers, not as a threat. It is an instrument that will protect their investment.

The Nigerian energy market often feels like it is moving at very different speeds, depending on which part of it you are looking at or who you are talking to. How can we develop and implement a plan that involves everybody?

One of the factors hampering a more rapid progress of local content investments is a lack of inter-agency linkages. Most of the government institutions that are supposed to play a role in moving local content forward are not singing from the same song sheet. For somebody looking at it all from the outside there are many moving parts and it gets confusing. That is why we at NCDMB started to try and see how we can collaboratively bring all these agencies to understand the common aspiration of government which is of course to move the economy forward. How can we walk together to realize that? Things are a lot better than in the past. Since my assumption in office two years ago I have established a collaborative framework between ten government institutions which is still ongoing. We have a lot of them but there are committees working on this framework so that it becomes easier to push through opportunities. Particularly in the life of this administration the discipline that has been brought to bear on the activities of agencies have greatly helped in this regard. A simple example is that I don’t get calls from the Presidency telling me what decisions to make. I have been in this position for 2.5 years and I have not been called, not even once. It used to happen all the time in the past.

How do you see this domain moving forward in the next 4 years? What is your goal for the institution and how do you see it being done?

We are not looking just four years ahead. We are looking at the next ten years instead. We developed and set up a ten-year strategy. This includes short, medium- and long-term aspirations. In the long term we want to create 300,000 jobs. We want to move local content attainment from the present 30% to 70% in the next ten years. We also want to develop enough human capacity training by adding 7 million-man hours of training in the next ten years, as well as supporting infrastructures to encourage manufacturing in-country. This is one of the major challenges, things are not manufactured in Nigeria because the reliable power needed does not exist. So, we are building 7 industrial parks which are powered by gas reliably. We are also playing actively in the downstream sector of oil and gas as we are building four modular refineries in order to help with the distribution of petroleum products. As an institution have developed what we call our investment policies. Our mission and vision are to act as a catalyst for the industrialization of Nigeria. So, of the key investments that will happen upstream, downstream and mid-stream in the oil and gas value chain we intend to participate actively in some cases taking equity and in others making funds available. We believe that if we stay on this path with these goals, we should be able to achieve them.

What would you tell someone that is looking to invest in Nigeria, in this sector specifically? What do you say to the Nigerian companies that are struggling?

My message to foreign investors looking at Nigeria is that you have to speak to the right people, and you have to obey the laws. A lot of people will encourage you to cut corners, but this will hurt you in the future. Third and most importantly I need to emphasize that the potential in Nigeria is huge both in its size and in its natural resources. The returns on investment are amazing, so this country is ideal for capital outlays right now. Nigerian companies must grow gradually and take on only the opportunities which they can deliver. You can’t run before you walk. You need to develop capacity to deliver. At the end of the day if the quality is not there or the schedule is not kept to, if you bite off more than you can chew, the customer will not be happy. Take it one step at a time in terms of growth.

Nigeria has great potential. Given the size of the country and its people they should look at Nigeria in a positive light. There are challenges but none are insurmountable. And the solutions to these challenges bring enormous rewards. It is very important for people in Europe to also understand that if we don’t create enough wealth in African countries, people will continue to cross the sea to come to Europe. So, you can be a part of the process to create that wealth. If we don’t achieve this, they will probably over run Europe. Norway is an example.

NCDMB date of interview: November 20th 2018