Namibia’s National Upstream Petroleum Local Content Policy was recently unpacked at a two-day stakeholder workshop in Windhoek.
The latest draft, released by the Ministry of Mines and Energy, articulates a vision to “create an internationally competitive petroleum sector that maximises the benefits to the country through meaningful and sustainable participation by Namibians and local companies across all areas of the value chain”.
Increasing local participation in the oil and gas industry ought to consume the attention of as many Namibians as possible.
Drawing from the workshop’s insights, I propose that the following thematic areas serve as fodder for the national oil and gas discourse for years to come.
The impact of recent oil and gas discoveries is directly contingent on our foresight, aptitude and grit.
Mines and energy minister Tom Alweendo underlines the need for inclusivity, transparency and the importance of eliminating a culture of entitlement.
That is, local participation as it relates to service delivery and enterprise management must hinge on capacity and merit.
This should be a refreshing clarion call to young people to proactively develop skills and leverage both existing and emerging opportunities to build the proverbial Namibian oil and gas house.
Importantly, there are different ways to define local content, depending on our strategic commercial objectives and context.
The minister has defined it as the active participation of Namibians in the oil and gas sector through training, employment and the provision of goods and services – with an important distinction between local content and local ownership.
Beyond this, local participation is expected to be achieved through training, local procurement processes and skills transfer.
International oil companies and industry service providers at the workshop stressed the need for this empowerment of Namibians.
This objective is noble and must be applauded.
That applause, however, must be filtered through a realistic lens – that, in general, commerce, and free market forces are not traditionally designed to allocate economic rents to maximise social welfare.
Commercial entities would necessarily have to go above and beyond the call of duty to maximise local participation across the oil and gas value chain.
In other words, in the hypothetical, dichotomous choice between maximising profits and pioneering local participation, companies are traditionally designed to opt for the former.
This is not necessarily a problem. It’s simply, as they say, business.
Therefore, young Namibians must not rely on charitable, good Samaritan efforts to be included.
They must be intellectually responsible and curious enough about natural resource development in Namibia that their participation and/or inclusion is a no-brainer.
Likewise, a local content policy framework is only half the work. Its implementation is confined by our operational reality.
For instance, the only oil and gas procurement and supply processes that can be outsourced are those we actually have the capacity to meet.
As it stands, realistic prospects for substantive engagement with the oil and gas value chain are abysmally undermined by a lack of local industrial expertise.
This must galvanise all Namibians to act on developing the required capabilities, refine national relevant competence, and rise to the occasion so as to avoid a catastrophic outcome.
Lastly, many have encouraged us to draw inspiration from Norway. This is wishful thinking.
Norway’s economic infrastructure and relative size provide a point of analytical and/or comparative divergence from Namibia that cannot be dismissed.
Norway has a well-established industrial base, robust infrastructure, and a highly skilled workforce, enabling them to maximise their engagement in the oil and gas value chain.
In contrast, Namibia faces limitations of economic diversification, infrastructure development, and skilled labour.
We must be honest about these contextual differences and tailor our approach accordingly.
Instead of attempting to replicate Norway’s exact model, Namibia should focus on leveraging its own contextual strengths. Nonetheless, there is hope.
I can’t help but conclude with a brilliant analytical framework by philosopher and quant Nassem Talib, whose work emphasises the impact of the highly improbable.
Taleb stresses that human beings are predisposed to a “future blindness” in which neither technocrats nor ordinary citizens can perfectly and precisely plan for the future.
Taleb is correct that action under conditions of incomplete information is the highest and most urgent human pursuit.
In this context, Namibians can take advantage of this industrial nescience and uncertainty by being prepared, thereby maximising our probable exposure to positive economic outcomes.
Namibians must take heart and prepare for an oil and gas season like our lives depend on it, because they do.
- Bertha Tobias is a California-based, final year undergraduate International Relations student with a concentration in oil, gas and energy; www.berthatobias.com and connect on firstname.lastname@example.org