The Minister of State for Petroleum Resources, Dr Edmund Daukoru has said that the recently concluded 2005 oil licensing round was used to promote indigenous participation in the upstream sector of the nation’s petroleum industry through the introduction of the Local Content Vehicle concept.

The minister who disclosed this at the just concluded 18 World Petroleum Congress in Johannesburg, South Africa, maintained that the bid round was
Sen. Lee Maeba & GMD NNPC, Engr. Funsho Kupolokun meant to offer local players the opportunity of participating in activities that were beyond the provision of goods and services in the industry.

He said: “The Nigerian government is actively promoting the internalization of inputs in the upstream sector. The objectives of the Local Content Policy are to promote a frame work that guarantees active local participation without compromising standards to promote value addition in Nigeria through utilization of local raw materials and human resources, and to promote steady, measurable and sustainable growth of Nigeria content.”

Dr. Daukoru stated that in order to aid local content development, government has adopted open competitive bid ding for most projects and has encouraged operating partners to carry out enlightenment programmes for indigenous contractors as well as domestication of reservoir management and seismic processing projects.

Some of the vehicles to drive the actualization of the local content programme include firming up modalities for refining 50% of Nigeria’s daily crude oil production within the shortest possible period; improving local staffing of multi-national oil companies; development of strategic plans for technology transfer and promotion of increased participation of Nigerian companies in engineering, procurement, fabrication and other services.

The 2005 bid round, he said, witnessed the first online bid ding in the country in which contenders saw competing offers and instant announcement of results, thus giving credibility to the transparency policy of government.

He maintained that block al location was used as incentive to encourage participation in down-stream activities especially with respect to the establishment of refineries and Independent Power Plants (IPPs), which concept has fast gained acceptance as the most practical way of accelerating the development of the nation’s infrastructure for energy and transportation, among others.

According to him, the vari ous licensing round initiatives are beginning to pay off and over a billion barrels have been added to the nation’s oil re serves, which producibility has increased from 2.0 million barrels per day in 2000 to the current level of about 3.0 mil lion barrels per day.

“With more deepwater fields, including Bonga, Agbami, and Erha coming on stream towards the end of the decade, production capacity is expected to increase significantly so much so that the nation could be well on its way to achieving the goal of 4 million barrels per day set by government for 2010,” he stated.