“From 26% to 56%: NCDMB Local Content Surges with Fiscal Policy Boost”

The Nigerian Content Development and Monitoring Board (NCDMB) has recorded notable improvements in Nigerian content levels in the oil and gas sector, even as broader Presidential fiscal and tax reforms reshape the operating environment for energy firms. With local content rising from 26 % in 2016 to 56 % in 2024, the Board’s progress underscores growing domestic participation in industry activities — but experts say fiscal policy has played a significant role in influencing this trajectory.

Performance Numbers 2016–2024
According to NCDMB monitoring reports:
2016: Local content at ~26 %, prior to the 10‑Year Strategic Roadmap.
2021: Achieved 42 %, ahead of that year’s target.
2022: Rose to 54 %, surpassing expectations.
2023: Maintained 54 %, signaling steadiness.
2024: Increased to 56 %, reflecting broader industry engagement.

These figures, drawn from Board evaluations, illustrate a sustained climb toward the 70 % local content target by 2027 established under NCDMB’s Strategic Roadmap.

Fiscal and Tax Reform — A New Operating Context

Nigeria’s recent Presidential fiscal and tax reforms, aimed at broadening the tax base, rationalizing incentives, and stabilizing government revenue, have impacted the energy sector’s investment calculus. Key reforms include changes to petroleum tax terms, adjustments to capital allowances, and revisions to import‑related levies.
Industry insiders note that while the reforms have increased compliance costs for some operators, they have also encouraged deeper local value retention and improved project planning.

Industry Voices: Commentary and Analysis
Celestine Ukpong, Economist:
“The fiscal reforms — especially in taxation and incentives — have compelled multinational and indigenous firms to rethink operational cost structures. In many cases, companies are turning more to Nigerian suppliers and service providers because local sourcing can be more cost‑efficient under new tax terms.”

Ukpong added, “Although increased fiscal burdens can slow project approvals, the net effect — when properly managed — can strengthen Nigerian content because investment dollars are kept within the local ecosystem.”

Peter Adebayo FCA, Financial Analyst:
“From a compliance and finance perspective, tax reforms have a dual effect: they increase direct costs for oil and gas firms but also enhance transparency and predictability in revenue regimes. The impact on NCDMB performance is clear: operators are placing more emphasis on efficient procurement processes and local certifications to optimize tax liabilities.”
Adebayo also cautioned that short‑term disruptions in investor spending could arise where fiscal reforms are sharpest, but long‑term gains may accrue through strengthened domestic participation and financial discipline.

NCDMB Compliance and Institutional Performance

Beyond content percentages, NCDMB continues to secure top marks in agency transparency and operational efficiency. Recent reports from the Presidential Enabling Business Environment Council (PEBEC) place the Board at the top of federal agencies for compliance and service delivery — a performance indicator that fosters confidence among investors navigating fiscal reforms.

Roadmap to 70 % and Strategic Progress
As of late 2023, the Board had completed 83 % of the initiatives outlined in its 10‑year Strategic Roadmap, bridging policy, skills development, and domestic value creation. This progress supports Nigerian content goals even as companies adapt to new tax structures and fiscal guidelines.

Looking Ahead

Industry analysts say the interplay between fiscal reforms and local content development will continue to influence performance metrics:
Fiscal discipline and local sourcing could deepen Nigerian participation.
Policy clarity and stable tax regimes will be critical for investor confidence.
Data on value retained locally should be more granular to reflect real economic impact.
“Local content isn’t just a percentage — it’s about economic resilience,” said Ukpong. “Fiscal reforms test that resilience, but they also present opportunities for domestic businesses if risk is well‑managed.”

Explore how NCDMB boosted Nigerian content from 26 % to 56 % (2016–2024), the influence of Presidential fiscal and tax reforms on energy sector performance, and expert insights from Celestine Ukpong and Peter Adebayo FCA.