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Oil and gas players want Buhari govt to be decisive on PIB

By on May 6, 2015

Oil and gas industry stakeholders have asked the incoming administration of General Muhammadu Buhari to be bold and decisive on the matter of the protracted Petroleum Industry Bill in his first month in office. Majority, infact are canvassing that it should be scrapped completely to refocuss attention on other ways to move the industry forward. Sola Adeputu, an energy law expert, making contribution during the Policy Dialogue Roundtable organised by the Petroleum Club recently in Lagos, said there is a need to de-emphasise PIB and move the industry forward.

Said Adeputu: “Before the PIB, there were existing laws driving the industry and Nigeria was making progress. With the uncertainty surrounding the PIB, the industry has been at a standstill”.

Victor Eromosele, chief executive of Mentor Energy, told BusinessDay that the decision on whether to pass the PIB or not, by the outgoing seventh National Assembly is squarely in the legislators’ court. “The damage has already been done”, he said, adding that the PIB should be unbundled, “the hydrocarbon tax aspect of it, for instance, should be expunged and passed immediately, while the more contentious issues can wait.

“If the discussion has not come round to passing the right PIB, the discussion should continue”, said Emeka Ene, chairman, Society of Petroleum Engineers (SPE), Nigeria Council, in an exclusive interview with BusinessDay on the sideline of 2015 Oloibiri Lecture Series and Energy Forum (OLEF) in Abuja recently.

“Every stakeholder in the oil and gas industry will want the PIB to be passed. However, passing the right PIB is better than just passing any PIB”,said Ene, adding that the nature of PIB the industry is waiting for, is the one that “balances investor interest or investor incentives with national interest.

“PIB is essential for long term investment in Nigeria. The fact that it has not been passed after 15 years is a disappointment”, he added.

Adeoye Adefulu, an energy law expert, and Ekpen Omonbude, economic adviser at the Commonwealth Secretariat, in a recent article published on petroleumindstrybill.com ,said “PIB passage at this late stage will significantly hamstring the incoming government which has not had a chance to give its input. Indeed, the current oil price crisis has changed the dynamics of the fiscal bargain and calls for reconsideration and the introduction of flexible mechanisms to deal with any future crisis”.

Sena Anthony, former group executive director of the state oil company, Nigerian National Petroleum Corporation (NNPC) said that “part of the confusion in the public space about the PIB is that most people who comment on the bill have not read the document and often end up ascribing to it, things that were not even mentioned in the document”.

Timothy Okon, Group Coordinator Corporate Planning and Strategy,NNPC, in his presentation at OLEF said Nigeria’s response to the current low oil prices should include among other things, passing the PIB.

The PIB was part of the recommendations of a presidential committee set up by the Obasanjo administration to carry out oil and gas sector reforms in the country. The bill was first introduced to the National Assembly in 2009. Since then, it has suffered a number of setbacks.

PIB proposes to completely overhaul Nigeria’s petroleum industry.

The current draft of the bill, sent to the National Assembly in 2013, seeks to, amongst others, restructure the regulatory and commercial institutions in the petroleum industry, change the fiscal dynamics and reform the operational mechanisms of the upstream, downstream and natural gas industries.

The delays have been on account of diverse interests in different provisions of the bill. Amongst these are the interests of legislators from the north, pitted against their southern counterparts, leading to years of disputes between the lawmakers, oil ministry/presidency, oil majors, host communities and other stakeholders.

 

[Business Day]