In a strategic move to bolster indigenous participation in the energy sector and ease access to low-cost credit, Nigeria has launched a $200 million fund to support local oil and gas companies. The initiative was announced by Emmanuel Kachikwu, Minister of State for Petroleum Resources, during a formal launch event in Abuja on Thursday.
Dubbed the Nigerian Content Development Fund (NCDF), the new financing vehicle is part of the government’s broader agenda to drive economic recovery, stimulate local capacity, and encourage technology-driven growth within the oil and gas industry.
Key Highlights:
Initial fund size: $200 million
Target borrowers: Indigenous oil and gas firms
Interest rate: Single digit over a 5-year tenure
Maximum loan amount: Up to $10 million per project
How the Fund Works
The NCDF will be financed by a mandatory 1% allocation from the value of all upstream oil and gas contracts awarded by the government. The fund aims to support local firms in:
Establishing manufacturing facilities
Acquiring strategic assets such as oil rigs
Accessing project fincing
Refinancing existing loans
The Nigerian Content Development and Monitoring Board (NCDMB), in partnership with the Bank of Industry (BoI), will jointly manage the fund and oversee its disbursement.
Speaking at the launch, Kachikwu emphasized the need for the fund to target “cutting-edge, tech-driven businesses” to ensure that Nigeria’s energy future is not only locally driven but globally competitive.
He also hinted at plans to scale the fund to $1 billion, though no specific timeline was provided for this ambitious expansion.
The launch comes at a time when Nigeria is grappling with economic headwinds, including its first recession in 25 years, largely triggered by a sustained drop in global oil prices. With oil revenues accounting for nearly two-thirds of national income, the government is betting on local content development as a pathway to sustainable growth.
