Mkpoikana Udoma
Port Harcourt — The Environmental Rights Action/Friends of the Earth Nigeria has faulted the setting aside of 30percent oil and gas profits for frontier explorations, stipulated in the Petroleum Industry Act.
According to the Chief Executive Officer of NNPC Limited, Mele Kyari, about $400 million would be spent annually to fund exploration of oil and gas in the frontier basins under the Petroleum Industry Act; the sum, which is from 30 percent of the NNPC Limited’s profit from oil and gas.
Recall that Section 9(5) of the PIA 2021 stipulates that NNPC Limited shall transfer the 30 percent of profit oil and profit gas to the frontier exploration fund escrow account dedicated for the development of frontier acreages only.
Section 9(4) stipulates that the Frontier Exploration Fund shall be from rents on petroleum prospecting licenses, rent on petroleum mining leases; and NNPC Limited’s profit oil and profit gas as in the production sharing, profit sharing and risk service contracts.
The fund shall be applied to all Basins and undertaken, simultaneously.
But the Executive Director of ERA/FoEN, Barr. Chima Williams, explained that oil exploration activity was a private business, hence the government has no business funding it.
Williams speaking virtually at a Workshop on Climate Crisis and Energy Transition organized by the Africa Network for Environment and Economic Justice, ANEEJ, wondered why Nigeria was even setting aside 30percent of her oil and gas profits for oil explorations, when the world was moving away from fossilized fuels to cleaner energy sources.
“What business do we have in investing money in funding oil in some parts of the country? Oil exploration is a private business, it’s not a government business. Today we are setting aside money to find oil in some parts of the country; it’s a call for caution.”
ERA further lamented that despite the enormous energy sources embedded in Nigeria, the country has no energy sustainability plans.
“Energy is available but unaffordable. Nigeria has abundant sources of energy, for example, flood water can be gathered into storm water and used to produce hydro power.
“The issue with Nigeria is not energy availability but distribution. Energy is not affordable in Nigeria despite the enormous energy sources embedded in this country.
“We lack a sustainable energy plan in this country. If energy is available and not affordable, then it is not sustainable.”
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