By Suleiman Aremu | Solaremnews
The Nigerian Content Development and Monitoring Board (NCDMB) and the Bank of Industry (BOI) have inaugurated the Investment Committee for the newly established 100 million US dollar Nigerian Content Equity Fund (NCEF), a financing initiative designed to provide long-term equity investment to indigenous oil and gas service companies and accelerate local content development in Nigeria.
The Executive Secretary of the NCDMB, Felix Omatsola Ogbe, inaugurated the committee in Lagos on Friday, describing the move as another milestone in the Board’s efforts to deepen Nigerian participation in the oil and gas industry through innovative financing.
Unlike conventional loan facilities, the Equity Fund will invest in qualified companies in exchange for equity stakes rather than debt, enabling businesses to access capital without the burden of traditional loan repayments. The initiative forms part of the Nigerian Content Intervention (NCI) Fund and is intended to bridge financing gaps that have long constrained indigenous operators.
According to the NCDMB, the Fund has a total size of 100 million US dollars, with a maximum investment of 5 million US dollars per beneficiary. While the NCDMB is providing the capital, the Bank of Industry will manage the Fund.
The Board explained that the Equity Fund seeks to reduce the cost of oil and gas products and services in Nigeria, create an additional revenue stream for the NCDMB, attract more private investment into viable indigenous companies and expand the market share of local service providers.
Beneficiaries will include oilfield service companies, manufacturers linked to the oil and gas industry, fabrication yards and other connected businesses. The initiative is also expected to stimulate economic growth, create wealth and generate an estimated 12,500 direct jobs and 7,000 indirect jobs across the sector.
The inauguration marks the latest expansion of the Nigerian Content Intervention Fund, which was established under Section 104 of the Nigerian Oil and Gas Industry Content Development Act to address financing challenges facing indigenous oil and gas firms. Over the past decade, five NCI Fund products managed by the BOI and two managed by the Nigerian Export-Import Bank have provided debt financing with repayment periods of up to five years at an interest rate of eight per cent.
Speaking at the inauguration, Ogbe charged members of the Investment Committee to undertake thorough due diligence before approving investments and ensure the objectives of the Fund are fully realised.
He stressed that the Equity Fund should not be viewed as a grant programme, insisting that beneficiary companies must deploy the capital responsibly and comply with the agreed investment terms.
“Our top priority should be identifying people who will use the Fund properly and, most importantly, return our funds back to us so that we can continue the programme for other deserving beneficiaries,” he said.
The Managing Director and Chief Executive Officer of the Bank of Industry, Olasupo Olusi, described the inauguration as a significant milestone in the evolution of the Nigerian Content Intervention Fund and the long-standing partnership between BOI and the NCDMB.
Olusi recalled that the collaboration began nearly a decade ago with the management of the 350 million US dollar Nigerian Content Intervention Fund, through which hundreds of indigenous oil and gas companies have received financing to expand their operations.
He noted that introducing an equity financing window fills a critical gap in the industry’s financing structure by supporting businesses that may not yet qualify for conventional bank loans because of collateral limitations.
“The next step, which I am very impressed with and very thankful to the NCDMB for thinking through with BOI, is the need to fill the finance gap with equity,” he said.
According to him, the Fund would attract additional investments into Nigeria’s oil and gas sector, strengthen indigenous participation and support sustainable industry growth. He also expressed confidence that members of the Investment Committee would discharge their responsibilities with integrity and professionalism.
Providing further insight into the initiative, the Group Head, Equity Investments at the Bank of Industry, Chike Chukwuelu, said the Equity Fund is designed to address what industry experts describe as the “missing middle”, where many promising indigenous businesses are unable to secure commercial loans despite having strong growth potential.
He explained that the equity investment model would also enable fund managers to maintain closer oversight of beneficiary companies, strengthen corporate governance, improve operational efficiency and help businesses evolve into sustainable enterprises.
Also speaking, the Senior Technical Adviser to the Executive Secretary of the NCDMB, Austin Uzoka, said the Equity Fund presents an opportunity to achieve objectives that previous financing interventions could not fully accomplish.
According to him, the Investment Committee will provide strategic oversight for the Fund, ensure prudent investment decisions and build a portfolio of companies capable of growing into major players in Nigeria’s oil and gas industry.
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