Nigeria: US$2 Billion Business Opportunity in Drilling Rig Equipment Repair Market

2013-08-21 553 0人评论


Nigeria occupies an important position as a maritime and petroleum hub in West Africa, and the country's drilling rig equipment operating capacity can reach 100 units. However, due to the technology gap and growing maritime security issues, combined with the huge obstacle that the non-passage clauses of the new Petroleum Industry Bill (PIB) pose to potential industry investors, the investment opportunities in the drilling rig repair market, valued at US$2 billion, have not yet been tapped by domestic or foreign investors.
  A single drilling rig repair plant can generate US$200 million in output per year, while also bringing Nigeria 12 billion naira in tariff revenue annually, and fees charged on vessels and equipment can also bring millions of dollars in revenue to the Nigerian Ports Authority. In addition, it can directly create 1,000 jobs.
  However, despite these many benefits, Nigeria "has the will but not the means." Due to factors such as a shortage of repair talent and insufficient investment funds, more than 100 drilling rigs were shipped outside Africa for repair in 2012, and billions of dollars in operating revenue were simply handed over to others. This has also indirectly led to the current number of drilling rigs in Nigeria having dropped to fewer than 30.
  It is understood that Nigeria currently has about three ship and drilling rig repair yards: Lagos Deep Offshore Logistics Base (LADOL), Nigerdock and Integrated Logistics Services (INTELS). Analysts believe that, under the local content act, as an important industry that can promote employment, it can directly create 10,000 direct jobs and 5,000 indirect jobs. This is only the effect Nigeria can produce as a maritime commercial hub on the west coast of Africa (capable of investing in and developing more ship and oil drilling rig repair and maintenance plants).
  Ms. Amy Jadesimi, General Manager of LADOL, a Nigerian logistics company engaged in drilling rig repair business, said that Nigeria has the potential to repair ships and drilling equipment operating in its waters and can attract ships and drilling equipment from other maritime and oil-producing countries in West Africa for repair. Analysts predict that by 2017 there will be about 250 offshore oil exploration projects in the region. She believes the government needs to attract and encourage Nigerians to attract more investors to build more plants in the country by creating a favorable investment environment.
  Eddy Wikina, former External Affairs Manager of Shell, said that there are indeed not enough repair plants in the country to meet the repair and maintenance needs of drilling equipment. He said this has caused capital to flow abroad despite the country's huge market, and the required positions are also filled by foreigners. At the same time, he stressed that adding more repair plants will provide more training opportunities for Nigerians who intend to master drilling equipment repair and maintenance technology.
  Abiodun Adesanya, General Manager of Nigerian exploration company Degeconekr, also said that because Nigeria has a lot of oil exploration business, Nigerians have great opportunities in the drilling equipment repair industry. He said that the country's oil exploration and development will create a large number of drilling equipment repair jobs.
  Nwankwo Charles, General Manager of NRG Rig Nigeria Limited, said that with proper training, Nigerians can repair and operate drilling equipment. "But unfortunately, Nigeria's polytechnics, which should provide these human resource training platforms, do not have enough equipment to train students." This is also why many Nigerian repair plants have turned to establishing their own training institutions to fill the human resource gap and create jobs. 
 

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