Nigeria Content Online

A collaborative
effort of the Nigerian Content Development and Monitoring Board (NCDMB)
and a Chinese company, Jiangsu Yulong Steel Pipe, will culminate in the
construction of a longitudinal submerged arc welding pipe mill, at most
by September 2012.

The mill capacity
will be 250,000 tons per annum. This initiative is part of the Board’s
efforts at increasing the local content capacity of the oil industry.

The schedule
comprises six activities and timelines agreed upon during a recent
visit by an NCDMB team, led by Ernest Nwapa, the executive secretary,
to Jiangsu Yulong’s facility in China. This was a follow up to the
meeting held in September 2010 between NCDMB and representatives of the
China company at the Board’s headquarters in Yenagoa, Bayelsa State.

The visiting team
inspected Jiangsu Yulong’s Longitudinal Submerged Arc Welding pipe mill
(LSAW), Helical Submerged Arc Welding pipe mill (HSAW), and the High
Frequency Resistance Welding Pipe Mill (HFRW).

The Board said the
initiative is geared towards meeting the targets set by the minister of
petroleum resources, Diezani Alison-Madueke, during the inauguration of
the governing council of the NCDMB by President Goodluck Jonathan last
year.

Mrs. Alison-Madueke
had declared that the implementation of the Nigerian Content Act will
in the next four years lead to the establishment of three to four new
pipe mills and other ancillary manufacturing plants to meet the demands
of the oil and gas industry.

The chairman of
Jiangsu Yulong, YongQing Tang, during the visit, reaffirmed the
company’s commitment to set up in Nigeria, pointing out that 80 per
cent of the equipment for the production line dedicated to the Nigeria
project had been manufactured and is awaiting testing and shipment.

Guarantees needed

Mr. Tang said the
proposed mill basic design had been completed and requested that the
Board provides guarantees that the Nigerian National Petroleum
Corporation (NNPC) and other major operators would patronise the mill
when operational.

He also said they
look forward to partnering with local companies and other Chinese
companies, like SINOPEC, operating in Nigeria, which are familiar with
the environment.

Mr. Nwapa assured
him that the Federal Government is actively promoting Foreign Direct
Investments (FDI), particularly in the energy sector, and will provide
all necessary support, approvals, and incentives to the company, adding
that government was committed to using locally manufactured pipes in
the construction of Nigerian Gas Master Plan infrastructure involving
over 2000 kilometres (km) of large diameter pipeline.

“The Nigerian
Content Law protects investors in any facility established in Nigeria
to manufacture industry inputs. So far, we have demonstrated our
ability to enforce the law by ensuring that oil majors now source
applicable line pipes from SCC Mill, the only manufacturer of pipes in
Nigeria today. When the Jiangsu Yulong pipe mill becomes operational,
NCDMB will not allow any operator in the industry to import
longitudinal submerged arc welded pipes until the capacity of its
facility and any similar plant is exhausted,” Mr. Nwapa said.

Details of the
project implementation schedule reveal that Jiangsu Yulong would work
with NCDMB between March and December this year to achieve milestones
like land acquisition, permits, environmental impact assessment,
detailed engineering, and early site works preparatory to moving the
mill.

There would also be
training and attachment of Nigerian operators to ensure that a
workforce is available when the plant is completed.