Industry Stakeholders Seeks Roadmap for Regional Collaboration at EAOGS 2020

By Ndubuisi Micheal Obineme

Industry stakeholders have advocated for a roadmap to establish a strong regional collaboration across the oil and gas value chain in Africa.

They made the call on Wednesday at the Sixth Edition of East Africa Oil & Gas Summit 2020 which was held virtually due to the COVID-19 pandemic.

The conference, organised by the Global Event Partners (GEP), has the theme: “Positioning East Africa As the Real Destination for Oil and Gas Investment”

In his words, President of Mozambique Oil & Gas Chamber, Florival Mucave, suggested the need to develop a regional master plan bringing together all stakeholders and players to draft a content that will be beneficial to the oil and gas industry in Africa.

He further explained that the master plan will be used to pressurise the government to advance the regional collaboration in the African continent.

Nuertey Adzeman, Executive Secretary of Ghana Oil & Gas Service Providers Association acknowledged that it is high time to establish a regional collaboration that will transform indigenous players to regional players.

He further explained that it will be easier to collaborate with other African countries such as Nigeria who had already developed a local content framework instead of waiting for foreign companies to do the job.

He continued, “If we wait for foreign service companies to come to do the job, we will keep wasting our time as they won’t build our capacity, they will not show us what certification we need and they will not transfer the skills and technical know-how. No foreign companies will teach you their business for you to take it away from them.

“We need to look inward the continent. It has been done in Nigeria, Ghana, Angola. And these are the players who have done it over the years, and they are the ones we need to look at.

“Between Ghana and Nigeria, there is a lot of collaboration going on between Ghanaian service providers and Nigerian service providers. There is a mobility advantage attached to the partnership. Within 5 – 6 hours, you can drive from Lagos to Accra. While between 40 minutes, you can travel by air from Abuja to Ghana. Ghana and Nigeria have a unique way of collaborating because they have many things in common.

“In Ghana, we have lots of indigenous service providers with trade development site and if we put our resources together, we will become bigger and do more on trade contracts. There is so much we can do if we establish a regional collaboration within the African continent.

“I strongly believe that the African Continental Free Trade Area will give us a bigger opportunity to foster collaboration in service provision. All we need to do is invite our neighbours who have done it before and foster collaboration with them. We are good to go.”

In his response, Emmanuel Mugarura, CEO of Uganda Service Providers Association confirmed that there is no regional collaboration between East Africa countries, noting that the laws in Kenya are not favourable to investors in Uganda. While the laws in Tanzania are not favourable to Kenya or Uganda investors.

“In East Africa, the five-member states have their own business laws. For instance, in Uganda, someone can come in and start-up a company to do business. Talking about our neighbours in Tanzania. It is said that for you to do a project, the company should be owned 100% by a Tanzanian.

“We do not have a harmonised law as they do not speak the same language. It will become very difficult for us to evolve from local service providers to regional service providers. We need to evolve our proposition so that we can harmonise our laws.

“In the past, when the laws are been enacted, the government didn’t involve industry stakeholders and players.  It was political. We need to be fully involved to influence the local content law. There are lots of challenges and it must be resolved at the regional level.

“There are big issues of capital investment on how our financial institutions finance us to move from one point to another. If capital is not made available locally, we will struggle and have problems to grow. Capital is key.

“Talking about capacity, I do not believe that we do not have the capacity because in the past when we participate in projects, we excelled. But we still need to have a strong foundation on capacity development so that we can move to the next level.

“The government also need to invest in skills development. In Uganda, skills acquisition in oil and gas is primary carried out by private investors which are quite expensive. But we need the government to invest in accreditation, skills, and certifications because it is very expensive for local service providers. Once we can do that, we will grow from been an indigenous player to a regional player.”