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The tempo of Nigeria’s local content drive rose significantly between 2005 and mid 2007. The rhetoric about increased domiciliation of oilfield work in the country transformed into measurable activities. The ‘NCD’ as the National Content Division of the state hydrocarbon company NNPC is generally known, started sounding like a dreaded phrase on the corridors of headquarter offices of International Oil Companies in Lagos and Port Harcourt.
The government mandated all contractors to create value in country with a target of 70% by end 2010 in terms of total monetary expenditures through the deliberate utilization of Nigerian human and material resources without sacrificing safety, health and environmental standards.
Newspaper advertisement for tender for oilfield contracts started including a clause that warned: “Failure to demonstrate commitment to Nigerian Content development may result in Bidder’s disqualification.”
Once Shell Nigeria completed the fabrication of the buouy for its Bonga deepwater field, at the Lagos dockyards of Nigerdock, NCD instructed that all CALM buoys be fabricated in Nigeria.
Chevron’s Agbami project immediately committed to the fabrication of approximately 6000 tonnes of equipment and structural modules at fabrication yards in Nigeria, a landmark development. Engineering design services continued to increase; one engineering contractor completed over 50,000 man-hours of engineering design in Nigeria between 2006 and 2007. Shell’s Southern Swamp Redevelopment project outlined a very aggressive Nigerian Content plan, including the design and construction of whole new flowstations and integration of substantial module in Nigeria, a marked departure from the token structural fabrication that had been done in the past.
By February 2007, three cable manufacturers in Nigeria were in discussions with various project teams of the major companies that could lead to supply of electrical cables for projects, a clear testimony of the persistence of the NCD, which had insisted that companies look at the locally manufactured cables and work out any quality deficiencies. These companies would supply all the cable required for projects once all the technical issues were addressed, thereby keeping millions of dollars in the Nigerian economy.
It was in the midst of this tempo, in February 2006, that the Movement For The Emancipation of Niger Delta announced its emergence, with bomb blasts of strategic  installations, especially the Escravos River part of the pipeline that delivers  natural gas to the country’s largest power plant as well as the major industries in Lagos. The attack heightened the sense of urgency about what has always been termed “the Niger Delta crisis”. But it also initiated a significant slow down of any meaningful progress that the national content programme was beginning to make.
MEND’s arrival with its bombing spree in the first quarter of 2006 happened to have taken place at the time the Nigerian military had muscled in on illegal bunkering of crude oil, which explains the interpretation, among oil industry security types, that the “boys” were not comfortable with the snuffing off of their source of livelihood. For all the big statement that the Movement made about being the representative of those who demand an egalitarian share of the proceeds of crude oil sales in the Niger Delta, the implication of its campaign wasn’t lost on the oil companies : it increased the opportunities for oil theft, which had been on the wane, just months before. The arrival of MEND, with the severity of its attacks has made the Nigerian security forces look so inept and emboldened several other gangs who abduct, kidnap and extort money from, initially, expatriates and latter Nigerians, especially those working for oil companies. It is not entirely to MEND’s credit that it is loose coalition of militant organizations.
Consider this: By late 2005, a barrel of illegally bunkered oil sold for as low as $10-15 and you didn’t get far to sell it; in Cote D’Ivoire or Sierra Leone. Those who delivered the oil got paid $7.50. With a mere 5,000 barrels per day, a big thriving business as established. These were the sort of businesses that the Military were trying to force out. They moved into the ransom business and grew that business too.
The ransom business- described by the press as The Niger Delta Hostage Crisis- grew large and ugly, increasing the risk for recruiting people from abroad to work in Nigeria, proving a disincentive to attract the best talents to Nigeria to work and train people. To mobilize a work boat with crew to the Niger Delta, you need to have two additional boats with military personnel to provide security. Disruptions of operations became a staple. Between 2006 and the first two months of 2007, onshore oil production of over 400,000BOPD were shut down. That has increased almost geometrically from mid 2008 through the second half of 2009. Shell’s operated production in Nigeria has fallen from 1.1Million barrels of oil per day, in November 2005 to 340,000Barrels Per Day in July 2009.