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Nigeria launches $100 million fund to boost local content in oil and gas sector
🇳🇬 Nigeria /Energy & Infrastructure

Nigeria launches $100 million fund to boost local content in oil and gas sector

From Premium Times · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

News Named sources New plan
  • The Nigerian Content Development and Monitoring Board (NCDMB) and the Bank of Industry (BOI) launched a $100 million Nigerian Content Equity Fund (NCEF) to finance local oil and gas service companies.
  • The fund provides long-term financing through equity rather than traditional debt, aiming to reduce costs, create income for NCDMB, and attract other investors.
  • The initiative is expected to promote economic growth, job creation, and wealth in Nigeria's oil and gas sector.

A significant financial initiative has been launched in Nigeria to bolster the local oil and gas service sector. The Nigerian Content Development and Monitoring Board (NCDMB) and the Bank of Industry (BOI) have inaugurated the Investment Committee for the Nigerian Content Equity Fund (NCEF), a groundbreaking $100 million financing product.

The NCEF is designed to offer long-term financing to service companies, providing access to funds in exchange for equity rather than conventional debt instruments. This approach aims to reduce the per-unit cost of oil and gas products and services locally, generate additional income for the NCDMB, and act as a catalyst for attracting other investors and lenders to financially viable organizations.

By providing access to equity financing, the NCEF will enable service companies to expand and increase their market share, which will contribute to the growth of the Nigerian oil and gas industry.

— Product PaperExplaining the intended impact of the Nigerian Content Equity Fund.

According to the product paper, the fund will enable service companies to expand their operations and market share, thereby contributing to the growth of Nigeria's oil and gas industry. The NCDMB provides the fund, while the BOI manages it. The primary beneficiaries include oil field service companies, manufacturers linked to the sector, and fabrication yards. The initiative is projected to create approximately 12,500 direct and 7,000 indirect jobs, fostering economic growth, job creation, and wealth.

The establishment of the Equity Fund marks a new direction within the Nigerian Content Intervention Fund (NCI Fund), which has previously offered debt financing. The NCDMB's Executive Secretary, Felix Omatsola Ogbe, stressed that the Equity Fund is not a grant and urged the investment committee to conduct rigorous due diligence, ensuring that beneficiaries utilize capital judiciously and adhere to investment terms. The priority is to identify credible businesses with viable plans.

Our top priority should be identifying credible people with viable businesses benefit from the scheme.

— Felix Omatsola OgbeStressing the importance of due diligence for the fund's beneficiaries.
DistantNews Editorial

Originally published by Premium Times in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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