Senate faults IOCs for neglecting petrochemicals
The Nigerian Senate has criticized international oil companies for not investing in the petrochemical industry.
The Chairman Senate Committee on Local Content, Natasha Akpoti-Uduaghan, said the committee would invite the international oil companies on the need to invest in petrochemicals.
Petrochemicals refer to a wide range of other products made from petroleum, including plastics, fabrics, fertilizers, paints, and medicines. The global petrochemicals market size was valued at $619bn in 2023 and is expected to grow at a compound annual growth rate of 7.3 percent from 2024 to 2030, a report by Grand View Research has revealed.
According to a statement on Friday by the Nigerian Content Development and Monitoring Board, Akpoti-Uduaghan spoke at a meeting with the NCDMB in Abuja.“The committee chair criticised the international oil companies in Nigeria for not investing in the petrochemical sub-sector and other associated manufacturing activities, whereas IOCs in other oil-producing jurisdictions make such investments and contribute significantly to those economies.
“She announced that the committee would invite the IOCs and other relevant agencies of government, to compel the companies to create tangible value in the Nigerian economy beyond the extraction and sale of crude oil,” the statement read partly.
Akpoti-Uduaghan was quoted as saying, “We need to get them round the table and tell them what we want as a country as against watching them export crude oil only.”
She assured all that the committee would not antagonize the board and other entities under its supervision but would collaborate towards effective implementation of the board’s mandate for the benefit of Nigerians.
She had expressed concern “over the parlous state of the economy, particularly the alarming level of unemployment which has fuelled an increase in criminality”.
The Senator emphasized the need to deepen the implementation of the Nigerian Oil and Gas Industry Content Development Act, to create employment opportunities from the activities in the oil industry and catalyze other sectors of the economy.
The Kogi Central lawmaker had requested the board to submit performance reports on the implementation of the NOGICD Act, specifically on the Board’s third-party investments, capacity-building programs, expatriate quota management, and research and development, while seeking recommendations on the sections of the NOGICD Act that needs to be amended by the National Assembly.
In his comment, the Executive Secretary NCDMB, Felix Ogbe, explained that most oil conglomerates have different arms, which include the downstream companies that make such investments in the petrochemicals and linkage sub-sectors.
He, however, noted that most operating companies in Nigeria do not have such subsidiaries in the country, hinting that the board is willing to support indigenous firms that are interested in such ventures.
Ogbe said, “The board lacked the mandate to compel the IOCs to change their business model in Nigeria, but was collaborating with some oil companies to develop the Nigerian Oil and Gas Parks Scheme which is designed to manufacture oil and gas equipment and components as well as other manufacturing and research and technology programs”.
