22 July 2016, Sweetcrude, Abuja – The of the Bureau of Public Enterprises (BPE), has called for the separation of the roles of the regulator from the operator and policy formulation in the Nigerian National Petroleum Corporation (NNPC) as currently practised.
The Acting Director- General of BPE, Dr. Vincent Akpotaire, made the call when he delivered a paper titled: ‘The Petroleum Industry Reform in Nigeria: Reinventing the Wheel by Innovation, at the National Stakeholders’ Workshop on the Petroleum Industry Reform in Abuja.
He lamented that the Directorate of Petroleum Resources (DPR) which ought to be a regulator for the industry is an arm of the NNPC in the present arrangement.
According to him, “NNPC currently acts as the policy maker, the regulator, as well as an operator of the policies which go against international best practices.
“It was because of the need to reform the sector that the National Council on Privatisation (NCP) in 2009 through the Federal Executive Council (FEC) transmitted to the National Assembly the Petroleum Industry Bill (PIB).”
He added that, “The challenges we are facing today were envisaged by the BPE over ten years ago hence the articulation of the Petroleum Sector Reform and the first ever drafted Petroleum Industry. After over a decade, we are still talking about the problems rather than the solution.”
Akpotaire pointed out that the delayed reforms in the corporation was meant to enthrone international best practices in the sector.
He further lamented that the first attempt to pass the PIB was stalled by the Ministry of Petroleum Resources after it had passed through the first and second reading and subsequently tabled for public hearing.
He said, “The ministry at that point made additional legal and regulatory provisions for a third regulator-the mid-stream petroleum sector regulator as well as other ancillary provisions that were claimed to have been omitted in the FEC’s approved draft bill.”
According to him, the 2009 version of the PIB sought among others to promote transparency and openness in the administration of the petroleum sector in Nigeria, separate the commercial institutions in the sector from the regulatory and policy making institutions deregulate petroleum product prices, increase domestic supply and put in place a fiscal framework for increased revenue.
This consequently led to the redrafting of other versions the PIB which, he noted, conflict with the NCP’s reform mandate and the globally accepted framework in the sector.
He noted, however, that, “The 2015 version of the PIB which is privately sponsored is outlined in only two parts, not properly structured into parts, creates an Asset Management Company, creates a Frontier Exploration Services, does not state who carries out the implementation of the reforms in the oil and gas sector; and also does not state who manages the funds on behalf of the Petroleum Host Communities Fund (PHCF).”
Further in a statement by BPE spokesman, Mr. Alex Okoh, the acting DG recommended that since the 2009 PIB approved by FEC had no controversial provisions, having had the benefit of review by stakeholders, it should be represented with necessary adjustments to reflect the current realities in the sector to the National Assembly for enactment.