Local Content in the Petroleum Upstream Sector - A Comparative Analysis of Ghana, Nigeria & Angola

Sub-Saharan African oil and gas producing countries have enormous potential to nurture and transform their economies through industrialization, jobs creation and equitable distribution of wealth. However, these countries are saddled with macroeconomic instability and weak governance structures and institutions. In order to improve economic growth and the efficient management of natural resource endowments, a new course of policy direction for governments in the sub-region is being chartered in the petroleum sector and is intended to guide the development and management of the growing oil and gas sector as a mechanism to foster the economic transformation agenda. One major goal of governments in the sub region is to optimize the exploitation of petroleum resource endowments for the overall benefit and welfare of their citizens in a sustainable manner. A major challenge in meeting this policy goal is; how to develop the oil and gas industry with optimal local content and participation to enhance national development and job creation. In this regard, the key policy objective is to maximize national value creation along the petroleum value chain, through employment, value creation, and transfer of knowledge and technology.

Regrettably, despite huge sums of money spent annually on projects in the oil industry, very little proportion of the accruable profit is available to indigenous oil service companies or invested in developing the nations’ industrial base. The high capital flight associated with the oil companies operating in the regions invariably leaves behind a trail of environmental and socioeconomic hazards for the indigenous population to deal with. 

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The Africa Centre for Energy Policy (ACEP) was established in 2010 to contribute to development of alternative and innovative policy interventions through high-quality research, analysis and advocacy in the energy and extractives sector in Africa.

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