Part 1 Section 3 of a Senate Bill 176 ensures that 50 per cent refining capacity should be domiciled in the country. The bill further states: ‘’Nigerian personnel shall constitute a minimum of 75 per cent of the investing company in the petroleum industry in accordance with the law.”
The President, International Association of Economics Energy (IAEE), Prof Adeola Akinnisiju, said a modification of the bill was necessary in view of the proposed privatisation of Warri, Kaduna, and Port Harcourt refineries.
He said Nigerians would have enough stakes when the refineries are privatised. ‘’I am okay by the content of the bill because it’s talking about local content initiatives,” he said.
He, however, argued that no ground would be lost if the bill is modified. When this happens, refinery capacity and petroleum activities are going to be above 75 per cent as contained in the bill. This implies that more Nigerians are going to have controlling shareholdings in the refineries.
‘’At present, we depend on importation of petroleum products into the country. By modifying the bill and subsequently privatising the refineries, it means there would be increase in local participation in the industry. This, on condition that, a transparent process is adopted by the Bureau of Public Enterprises,’’ he added.
According to him, the power sector reforms have set the tone of what to expect in the petroleum industry. The reforms, he said, have resulted in the sale and subsequent ownership of assets of defunct Power Holding Company of Nigeria (PHCN) by Nigerians.
‘’We should expect a situation whereby the refineries would be own 100 per cent, once the National Assembly is able to amend the bill. Like what happened in the power sector where Nigerian companies acquired the PHCN’s assets, the same thing is expected when the refineries are privatised,’’ he added.
Also, the Chairman, Petroleum and Gas Workers Senior Staff Association of Nigeria(PENGASSAN), Mr Folorunso Ogini said, amendment of the bill is good and capable of encouraging local initiatives. He said Nigerians would leverage on the bill to ask for more stakes when the privatisation process starts.
He cautioned the government on the issue, noting that efforts to sell the government enterprises failed in the past.
“What happened to the British Airways? What happened to the Nigerian Telecommunication Limited (NITEL) NICON Insurance and other publicly-owned enterprises that the government intended to sell? They are dead because the government failed to follow due process. So, the issue of refineries must be handled with caution to achieve success, ’’ he said.
– The Nation