A Review of the Nigerian Energy Industry

Reps to consider beleaguered PIB tomorrow

Nigeria's House of Representatives.
Nigeria’s House of Representatives.

11 May 2015, Abuja – THERE is palpable fear that the much orchestrated Petroleum Industry Bill, PIB may not sail through as it failed in the last days of the sixth Assembly as the House of Representatives commence consideration of the bill tomorrow.

The seventh Assembly would grind to a halt on June 6 when a new eighth Assembly kick starts. The 302 clause bill which was killed in the last days of the Dimeji Bankole led sixth Assembly may tear the House into regional lines.

Deputy speaker of the House, Emeka Ihedioha had last week Thursday announced that clean copies of the report of its ad hoc committee on the bill has been circulated to lawmakers preparatory for tomorrow’s exercise.

But a member of the House from one of the South-south states who spoke to Vanguard under the condition anonymity said that they are expecting a tough session with consideration of the bill.

He said there are varying interests concerning the bill and some of these interests are entrenched in members of the House.

“We are expecting an explosive session. As you know, the PIB has been with us for a long time and it is a very contentious biil therefore we are not expecting a swift passage. “There will be some disagreements along the line and members will definitely raise eye brows on some aspects of the reports. So, I would say it will not be an easy passage. I can tell you there are interests; deep seated interests but all in all we have decided to have this bill passed once and for all”, he noted.

However Chairman of the ad hoc committee and House Chief Whip, Rep Ishaku Mohammed Bawa, PDP, Taraba who laid the report on the floor believed that the committee, has done part of the job and considering the bill wiil not pose any challenge.

He said the committee had scrutinised the whole 363 sections and annexures of the original bill and made some amendments and recommendations.

He said the zonal public hearings were thorough and various stakeholders had the opportunity of making inputs to the bill so all the contentious areas have been taken care of.

The original bill covered salient areas such as establishment of the Petroleum Equalisation Fund, incorporation of National Gas Company, establishment of petroleum directorate and National Asset Management Company as well as imposition of new tax regime such as Nigeria Carbon Tax.

In the report, the committee recommended the “complete removal” of section 191 of the bill that gives the president discretional powers to grant petroleum licences and lease and instead proposed biddings for the award of licences.

On the powers of the minister of petroleum, the committee retained the conventional powers of the minister under section 6 of the bill but recommended the removal of powers of the minister either to serve as chairman or to recommend to the president the appointment of chairmen of boards of such agencies.

The committee also amended section 174 recommending that 30 per cent of Nigerian National Petroleum Corporation (NNPC) shares be sold through public offers at the Nigerian Stock Exchange (NSE) as well as section 185 proposing that 49 per cent of Nigerian Gas Company shares be sold through public offers at the stock exchange.

The report recommended creation of Frontier Oil Services Agency in sections 193 to 217 to step up exploration activities in various Frontier Acreages of Nigeria’s oil industry which comprises, among others the Anambra, Sokoto, Benin, Chad and Benue Basins.

The Frontier Oil Service is to be funded through taxes from oil producing operations as well as National Budgetary allocations in a dual funding strategy aimed at strengthening the Agency’s and its operations so as to broaden government’s revenue base. This is captured in section 209.

Also, in the report, oil production measurement is to be made at the flow station and not at the point of export. Under section 116, the Petroleum Host Community Fund is created to benefit any community where oil facilities and installations such as pipelines, depots and refineries are located. Under section 203, the committee retained environmental remediation funds, which obligates petroleum investors to pay adequate compensation for the remediation of environmental damage.
*Emman Ovuakporie – Vanguard

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