The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu yesterday said that the target of the ministry is for the Nigerian Content Development Monitoring Board (NCDMB) to secure $1billion intervention facility.
Speaking during the signing of the Memorandum of Understanding (MoU) of $200million Nigerian Content Intervention Fund in Abuja, he noted that the facility would be a relief to players in the industry that lack funds.
“My goal is $1billion, I expect the oil industry to begin to expand and how we can contribute this fund,” he said.
Kachikwu tasked the management of the fund to consider geographical spread, sectorial coverage and community interest in the issuance of the loan to the stakeholders.
He also urged them to embark on the sensitization of the host communities on how to access the loan.
The minister vowed that the industry would work towards reducing the cost of production of crude oil from $32 per barrel to $15/barrel.
According to him, Nigeria is presently the second or third country with the highest cost of production of crude oil globally.
He said that “we are reducing the cost of production from $32/barrel. We are heading to $15billion. We are second or third country with the highest cost of production. We must drag it down.”
He told the Executive Secretary of the board, Mr. Simbi Wabote that the present 26% value retention recorded in the industry is too low, stressing that the NCDMC should work towards improving it to 50%.
On the challenges in the industry, Kachikwu noted there remains an infrastructure gap, adding that power for gas delivery, tariff issues were still inhibiting the progress in the industry .
He urged Nigerians to refrain from the pessimism and disillusionment that permeate their discourse of the state of the nation.
He asked the citizenry to recall that there was a time that they were queue for the Premium Motor Spirit (PMS) which has now become history.
Speaking, Wobote drew the stakeholders attention to pre-NCMDB establishment when the nation recorded a capital flight of $308billion in 50 years.
According to him, the board has been very consistent in the improvement of Nigerian content and the country now spends $5b yearly.
Nigeria, he said, now has five coating factories, four active dry dock and a record of 26% value retention while hope abounds to raise it to 70%.
He said no new Final Investment Decision (FID) for cash call obligation has been taken in the industry in the last seven years but the MoU has now served to meet the fund challenges.
Continuing, he said that “we are excited at this single digit fund that has single obligor limit. Applicants must have been contributors to this fund that has maximum of 45days processing time.”
He advised them to utilize the fund accordingly, urging them not to spend it in paying rent or marriages.
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