The Nigerian Content Development and Monitoring Board (NCDMB) has issued a renewed directive, compelling operators, contractors, and service providers within Nigeria's upstream oil and gas sector to strictly adhere to the mandatory one per cent deduction for the Nigerian Content Development Fund (NCDF) on all qualifying contracts.

According to a statement released on Wednesday by the board’s General Manager, Corporate Communications, Dr. Obinna Ezeobi, this renewed warning signifies a firmer enforcement approach. The board cautions that non-compliance could jeopardize companies' access to essential regulatory approvals and certifications.

This directive reinforces the board’s statutory mandate to enhance local participation in Nigeria’s oil and gas industry and to ensure strict adherence to the provisions outlined in the Nigerian Oil and Gas Industry Content Development Act, 2010.

Executive Secretary of NCDMB, Felix Omatsola-Ogbe, clarified that the NCDF was established under Section 104 of the Nigerian Oil and Gas Industry Content Development Act, 2010, as a dedicated fund to bolster indigenous involvement across the oil and gas value chain. He stressed the legal obligation for all entities engaged in upstream petroleum operations to remit one per cent of the value of every contract into the fund, which is exclusively managed by the board. He further noted that strict adherence to the one per cent deduction is crucial for sustaining the fund’s impact on local capacity development and industry growth.

The Nigerian Oil and Gas Industry Content Development Act, enacted in 2010, aimed to address the previously limited involvement of indigenous firms in Nigeria’s oil and gas sector, where much of the technical expertise, financing, and procurement were dominated by foreign companies.

Over the years, the NCDF has evolved into a key instrument in the board's strategy to cultivate technical expertise, empower indigenous companies, and decrease dependence on foreign service providers. The fund supports Nigerian contractors and service companies through targeted financing and capability development programmes. Proceeds are directed toward training initiatives, technical development schemes, and affordable financing support for Nigerian firms.

The board has emphasized that the fund is legally ring-fenced and separate from general government revenues. All remittances must be paid strictly into accounts officially designated by the NCDMB to be recognized as valid compliance.

The NCDMB has now mandated the Nigerian Content Development Fund Compliance Certificate (NCFCC) as a prerequisite for accessing several of its regulatory services. Without a valid compliance certificate, companies may be denied access to regulatory documents, certifications, approvals, and operational clearances issued by the board.

In February 2025, the NCDMB insisted that international Oil Companies (IOCs) must patronize local firms in the execution of their projects, aligning with the Nigerian Oil and Gas Industry Content Development (NOGICD) Act.

The NCDF has reportedly grown into a major industry intervention pool exceeding 300 million dollars, making it a key financial tool used by the board to enforce local content and foster indigenous enterprise growth in Nigeria’s oil and gas industry.