NCI Fund Receives Additional $150m
The Nigerian Content Intervention Fund (NCI Fund) has received additional $150million, following the expansion of the Fund from $200 million to $350 million.
The upward review of the Fund was part of the resolutions reached at June 16, 2020 meeting of the Governing Council of the Nigerian Content Development and Monitoring Board (NCDMB).
The meeting, held virtually, was chaired by the Minister of State, Petroleum Resources, Chief Timipre Sylva, who doubles as Chairman of the Governing Council.
The Deputy Director (Information), Enefaa Bob-manuel, announced this in a statement on Monday.
According to her, the “Council also approved that USD 100million from the added sum be channelled towards the existing Loan Products of the NCI Fund with a view to enhancing them.
These include; Manufacturing Asset Acquisition, Contract Finance, Community Contract Finance, and Loan re- financing.
“A further breakdown of the utilisation of the added sum, and as approved by Council is the deployment of USD 50 Million to two newly introduced loan products types namely; the Intervention Fund for Women in Oil and Gas which gets USD 20 Million, and PETAN (Petroleum Technology Association of Nigeria) Products that was allocated USD 30 Million. The PETAN products include Working Capital and Capacity Building loans for PETAN member companies.”
The NCI Fund, according her, was birthed in 2017 with a start-up fund of USD 200 Million. It’s a portion of the Nigerian Content Development Fund (NCDF) set aside by the NCDMB for BOI (Bank of Industry) to manage and lend directly to indigenous manufacturers, service providers and other key players in the oil and gas industry, to meet their funding needs.
The statement added that one percent of all contracts, subcontracts, projects and activities in the upstream sector of the Nigerian oil and gas industry is statutorily to be deducted and remitted to the NCDF, as stipulated by Section 104 of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act of 2010.
It said about 94 percent of the NCI Funds have been disbursed to no fewer than 27 beneficiaries as at May, 2020, while NCDMB have received more applications from companies.
The maximum tenure for all loan types is Five (5) years, and applicants cannot have two different loans running simultaneously.
At inception of the Fund, the applicable interest rate for the various loan types was pegged at Eight (8) Percent, except the Community Contractor Finance Scheme, which was Five (5) percent.
However in April 2020, as part of NCDMB’s response to mitigating the economic impact of COVID-19, Council approved the reduction of the interest rate from eight (8) to six (6) Percent Per Annum for all four of the loan products while the Board also extended the moratorium for all loan products.