NIGERIA – The Nigerian Content Development and Monitoring Board (NCDMB) has secured approval to launch a US$50 million fund for the NOGAPS Manufacturing Product Line.
The fund will support oil and gas companies that operate in the oil and gas parks developed by the Board in Bayelsa and Cross River State.
The parks are expected to be commissioned and operational in the 4th quarter of 2022 and would incubate the manufacturing of equipment components utilized in the oil and gas industry and create an estimated 2000 jobs in each park.
NCDMB understands the challenge associated with manufacturing, especially the reluctance of banks to extend loans to manufacturers, because of the long repayment period for such facilities.
The Executive Secretary of NCDMB, Engr. Simbi Kesiye Wabote disclosed that the NOGAPS Manufacturing fund will soon be launched and will be managed by the Bank of Industry (BoI) to address the identified challenges.
The new fund would be a stand-alone product line with distinct fund allocation and special eligibility criteria and collateral structure.
The decision of the Board to establish the product was informed by the peculiarities of the manufacturing sector.
The Board established the NCI Fund in 2018 with the purpose of financing Oil and Gas companies to increase capacity and grow Nigerian Content in the Industry.
Presently, the NCI Fund has five product lines which are being managed by the Bank of Industry.
The product line includes Manufacturing Finance -US$10m, Asset Acquisition Finance -US$10m, Contract Finance -US$5m, Loan Refinance -US$10m, and Community Contractor Finance – N20 million (US$48k).
The Board also has a US$30 million Working Capital Fund for oil and gas service companies and a US$20m Fund for Women in Oil and Gas Intervention Fund.
Both facilities are administered by the Nexim Nigerian Export-Import Bank and the agreements were signed in mid-2021.
The Executive Secretary stressed that the manufacturing sector is central to the overall initiative of the Federal Government and
He added that NCDMB is required to develop the economy and create indigenous capacity in the supply chain.
The secretary underscored the linkage between access to manufacturing finance with the viability of the Nigerian Oil & Gas Parks when operational.
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