Nigeria’s Oil, Gas Sector Can Accommodate Both Foreign, Local Firms – FG

The Federal Government has reaffirmed that Nigeria’s oil and gas industry has sufficient capacity for both international Engineering, Procurement and Construction (EPC) companies and indigenous operators to operate side by side, as it moves to reposition local content as a catalyst for industrial growth rather than a box-ticking regulatory exercise.

The Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, made this known on Monday in Abuja during his opening remarks at the official pre-conference session of the 2026 Nigeria International Energy Summit (NIES).

The ninth edition of the summit, themed “Energy for Peace and Prosperity: Securing Our Shared Future,” brings together policymakers, industry leaders and investors to deliberate on Africa’s evolving energy landscape, with a strong focus on local content development, gas-led industrialisation and regional energy security.

For many years, EPC services within Nigeria’s oil and gas sector—particularly offshore and deepwater projects—were dominated by international oil companies and foreign contractors due to their access to advanced technology, capital-intensive equipment and specialised expertise.

While this model delivered efficiency, it also resulted in significant capital flight and limited domestic capacity development.

To reverse the trend, the Federal Government enacted the Nigerian Oil and Gas Industry Content Development Act in 2010, mandating greater indigenous participation, local fabrication, technology transfer and skills development.

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Since then, policy direction has shifted toward a local content-driven execution framework designed to retain value within the economy and deepen Nigerian participation across the oil and gas value chain.

However, Lokpobiri noted that years of poor implementation of the local content framework had increased project costs, weakened competition and failed to deliver the depth of capacity initially envisioned.

Addressing industry stakeholders, the minister stressed that cooperation—not rivalry—was the sustainable path forward.

“Today’s edition is dedicated to local content. Local content is so fundamental to Africa’s achievement of our energy growth as a country. When I became Minister, one of the first things I was confronted with had to do with the issues surrounding local content. And every time I travel, I am confronted with why the cost of projects is even higher in a country than at home. And so we had to find a solution. And we found out that the problem was the misapplication of the local content.

“Our state is big enough for both EPC companies and the local companies to cooperate. Do you agree with me that the local companies today cannot do any work, you know, in EPC, in offshore exploration? That remains, you know, within the exclusive capacity of EPC. And most of the time when I engage members of EPC, they will tell me their approach and concept is higher because they seem to be a monopoly.

“Monopoly in the sense that, perhaps not a siphon, maybe the only company that, whatever price they give to you, you have to take. Because there is no competition, you know. There is no competition between international EPCs and indigenous firms. The space is big enough to accommodate everybody.”

Lokpobiri acknowledged that while local participation had improved in form, Nigeria still lacked the technical depth required to independently execute complex offshore and deepwater projects.

He traced this gap to what he described as a fundamental misapplication of the local content law since its passage in 2010, when he served on the National Assembly committee that considered the legislation.

According to him, the original intent of the Act was to build Nigerian capacity through deliberate partnerships, not to shut out international expertise.

“The spirit of the local content Act was to build capacity, not to push EPC companies away. Unfortunately, we promoted middlemen instead of growing strong Nigerian companies,” he said.

The minister also criticised the way financing mechanisms under the NOGIC Act had been utilised, noting that access to funds had not always translated into genuine capacity development.

“I discovered that many companies that benefited from local content financing did not grow any capacity. They took the money and financed their lifestyle. That was never the intent,” Lokpobiri said.

He explained that these shortcomings informed the decision for the Minister of Petroleum Resources to chair the Nigerian Content Development Council, in order to provide what he described as “real strategic leadership” and ensure funding is directed toward companies committed to long-term growth.

“Our objective now is to bring everybody together, indigenous companies, local firms, and international partners, so that there is real value retention, capacity building, and sustainability,” he said.

Lokpobiri further emphasised that genuine local content cannot be achieved without sustained investment in human capital, pointing to ongoing initiatives by the Nigerian Content Development and Monitoring Board (NCDMB) and industry partners.

“For us to get to that level, we need human capacity development,” he said. “Training by institutions like the NCDMB is critical. Scholarships alone are not enough.”

He also revealed plans to establish a world-class energy university and training centre in Portugal to help address Africa’s growing manpower needs.

“These institutions are targeted at training the manpower required to manage the oil and gas industry locally, not just in Nigeria but across Africa,” he said.

Also speaking at the event, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, described natural gas as central to Nigeria’s industrial future and called for a performance-based approach to local content development.

Ekpo, who was represented by the Permanent Secretary of the Ministry of Petroleum Resources, Mrs Patience Oyekunle, said Africa’s industrialisation ambitions could not be realised through policy declarations alone.

He said, “From power generation and clean cooking, to fertilisers, petrochemicals, methanol, and compressed natural gas for transportation, the gas value chain offers unparalleled opportunities for job creation, industrial clustering, and regional integration.

“These opportunities, however, can only be sustained if local companies possess the requisite skills, technology, financing, and governance standards to compete at scale,” he added.