The Executive Secretary of Nigerian Content Development and Monitoring Board (NCDMB), Engineer Simbi Wabote, has assured that the new oil and gas insurance guidelines, midwifed through the Board’s collaboration with the National Insurance Commission (NAICOM) will lead to a higher retention of the industry spend within the country.
He was speaking in Yenagoa on Tuesday during the launch of the guidelines which is designed to drive local content in the insurance industry particularly as it concerns oil and gas sector.
“This Insurance Guidelines, drawn up by the Board and NAICOM, will lead to more value addition and usage of Nigerian insurance firms and insurance brokers registered in Nigeria.
Wabote commended the successful collaboration between his agency and the Insurance Commission which culminated in the fashioning he guidelines.
He emphasised that the new guidelines will give bite to sections 49 and 50 of the NOGICD Act.
“I am delighted to announce that this Insurance Guidelines addresses loopholes that have been identified by the Board in implementing the provisions of the NOGICD Act, particularly sections 49 and 50,” Wabote said.
“As we are aware, the combined provisions of sections 49 and 50 require all operators engaged in any form of activity or project in the Oil and Gas industry to ‘’insure all insurable risks related to its oil and gas business…with an insurance company, through an insurance broker registered in Nigeria.’’
“The NOGICD Act provides that where an operator seeks to place an insurable risk offshore, a written approval of NAICOM must first be sought and obtained and that NAICOM, prior to the issuance of the approval, must first determine that ‘’…local capacity has been fully exhausted,” he further explained.
“The essence of the above provisions of the NOGICD Act was to ensure the full utilization of available in-country capacity in the Insurance sector before seeking offshore insurance services. This is expected to support retention of capital in-country and build capacity of Nigerian insurance companies in the oil and gas industry.
“It is believed that the implementation of this Insurance Guidelines will further strengthen the Board’s local content drive and ensure that a greater portion of the spend in the Insurance industry as it relates to oil and gas activities in Nigeria is retained in-country.