Local Content Plan (Nigeria)

A Local Content Plan in Nigeria sets out the local content plan and the obligations it places on the parties.

Nigerian Content — defined in Section 106 of the NOGICD Act as the quantum of composite value added or created in the Nigerian economy through the utilisation of Nigerian human capacity, goods, services, technology, financing, and infrastructure in the petroleum industry — is central to Nigeria's indigenisation policy for the extractive sector. The NOGICD Act, enacted on 22 April 2010 and administered by the NCDMB (headquartered in Yenagoa, Bayelsa State), requires all operators, contractors, and subcontractors in the Nigerian oil and gas industry to submit Nigerian Content Plans for review and approval by the NCDMB before the award of any contract or licence. Non-compliance — including submitting false or misleading information in a Nigerian Content Plan — is a criminal offence under Section 68 of the NOGICD Act, punishable by a fine of up to 5% of the project value or contract sum and cancellation of the contract.

The NOGICD Act establishes minimum Nigerian Content thresholds across a wide range of activities: Section 3 requires that all operators give first consideration to Nigerian independent operators in the award of oil blocks; First Schedule to the Act sets out minimum Nigerian Content percentages for specific goods and services categories (for example, 100% for legal services, 100% for insurance services, 45% for engineering design, 5% for deep water equipment); and Section 8 requires that Nigerian companies must be given first consideration in the award of every contract, and a sole-source contract may not be awarded to a foreign company if a Nigerian company is capable of performing the work.

The NCDMB has issued Nigerian Content Regulations, Circulars, and Guidelines — including the Nigerian Content (Trainee and Training Fund) Regulations — that impose additional obligations on companies, including the requirement to pay 1% of the value of every contract into the Nigerian Content Development Fund (NCDF) administered by the NCDMB.

Beyond the oil and gas sector, Nigerian Content or local content obligations exist in other regulated sectors: the Nigerian Communications Commission (NCC) has issued a Nigerian Content Policy for the telecommunications sector; the CBN has issued a Nigerian Content Policy for the financial services sector; and the Bureau of Public Procurement (BPP) administers a Preference for Made-in-Nigeria Goods Policy under the Public Procurement Act 2007 for all federal government procurement.

The legal framework governing the Local Content Plan (Nigeria) in Nigeria draws on several key statutes and regulatory bodies. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Parties executing a Local Content Plan (Nigeria) in Nigeria should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Companies and Allied Matters Act (CAMA) 2020 sets the foundational requirements.

A Local Content Plan in Nigeria is required in a number of regulated contexts, most prominently in the oil and gas sector under the NOGICD Act 2010.

A Local Content Plan is required before the award of any contract in the Nigerian oil and gas industry — upstream, midstream, or downstream — including contracts for exploration, drilling, production, construction of oil and gas facilities, supply of goods and equipment, provision of services (engineering, legal, financial, insurance, logistics, catering), and information technology. Under Section 10 of the NOGICD Act, no contract may be awarded without NCDMB approval of the contractor's Nigerian Content Plan.

A Local Content Plan is required when an operator applies to the NCDMB for approval of its Annual Nigerian Content Performance Report — demonstrating compliance with the Nigerian Content commitments made in its approved Local Content Plan for the previous year, and setting out updated commitments for the current year.

A Local Content Plan is needed when a Nigerian or international company bids for a contract with a Nigerian National Petroleum Company Limited (NNPCL) — which replaced the NNPC following the Petroleum Industry Act 2021 (PIA) — or with any international oil company (IOC) operating in Nigeria such as Shell, TotalEnergies, Chevron, ExxonMobil, or ENI, all of which are required by the NOGICD Act to impose Nigerian Content obligations on their contractors and subcontractors.

A Local Content Plan is required when a company applies to the Department of Petroleum Resources (DPR) — now replaced by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) under the Petroleum Industry Act 2021 — for an Oil Mining Licence (OML), Oil Prospecting Licence (OPL), or other petroleum licence.

A Local Content Plan may also be needed for federal government procurement contracts under the Public Procurement Act 2007, where the Bureau of Public Procurement (BPP) requires bidders to demonstrate Nigerian content in the supply of goods and services, particularly under the Executive Order No. 003 of 2017 (Support for Local Content in Public Procurement by the Federal Government of Nigeria) signed by President Muhammadu Buhari.

Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters.

A Local Content Plan in Nigeria for the oil and gas sector — the most regulated context — must contain the following essential elements as required by the NOGICD Act 2010 and NCDMB Guidelines.

Company and Project Identification: Full legal name of the operator, contractor, or subcontractor; CAC RC number under CAMA 2020; NCDMB registration number; description of the project or contract for which the plan is submitted; contract value in NGN (or USD, converted at CBN official rate); and the proposed contract duration.

Nigerian Workforce Commitment: A statement of the total workforce to be engaged on the project, specifying the percentage of Nigerians (by headcount and wage bill) in each category — management, professional, skilled, and unskilled — with specific numerical targets for Nigerian employment. Section 28 of the NOGICD Act requires 100% of unskilled workers, 100% of junior management, and minimum percentages of management positions to be Nigerians.

Training and Capacity Development: A training plan for Nigerian employees and a commitment to the Nigerian Content Training Fund — 1% of the contract value payable to the NCDF under the Nigerian Content (Trainee and Training Fund) Regulations — specifying the number of Nigerian trainees, the training programmes, and the total training expenditure budget in NGN.

Nigerian Goods and Services Procurement: A schedule of all goods and services to be procured for the project, specifying for each category: the estimated NGN value, the applicable minimum Nigerian Content percentage under the First Schedule to the NOGICD Act, and the company's commitment (which must meet or exceed the minimum). Priority must be given to Nigerian manufacturers, suppliers, and service providers registered on the NCDMB's Nigerian Content Compliance Certificate (NCCC) register.

Technology Transfer: A description of any technology transfer commitments — including the establishment of research and development facilities in Nigeria, joint ventures with Nigerian companies, and intellectual property licences to Nigerian entities.

Financial Commitment: A statement of the financial instruments to be used on the project that qualify as Nigerian Content — including bank guarantees issued by Nigerian banks, performance bonds from NAICOM-licensed Nigerian insurers, and financing sourced from Nigerian financial institutions.

Nigerian Content Compliance Certificate: Confirmation that the company holds a valid Nigerian Content Compliance Certificate (NCCC) issued by the NCDMB, which is a prerequisite for contract award under the NOGICD Act.

Monitoring and Reporting: A commitment to submit quarterly Nigerian Content Performance Reports to the NCDMB, allowing NCDMB to monitor actual Nigerian Content performance against the committed targets.

Additional compliance elements for a Local Content Plan (Nigeria) used in Nigeria include: Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Forms-legal.com provides this template as a starting point for Nigeria-compliant documentation.