22 July 2013, Abuja – Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, has described the draft oil reform law, currently before the National Assembly for legislative action, as a vibrant document which would remain relevant to the oil and gas industry long after the exit of President Goodluck Jonathan’s administration.
She spoke to newsmen, weekend, at the end of the two-day Senate Public Hearing on the Petroleum Industry Bill, PIB.
Mrs. Alison-Madueke called on stakeholders in the oil and gas industry not to politicise or personalise provisions of the bill, stressing that the draft legislation was not proposed or written with any administration in mind.
A statement by Tumini Green, Acting Group General Manager, Public Affairs Division of the Nigerian National Petroleum Corporation, NNPC, said the Minister spoke against the backdrop of fears in some quarters that the proposed law vests too much discretionary power in the President and Petroleum Minister.
He explained that the responsibility for the exercise of the powers proposed in the bill for the President and Petroleum Minister will ultimately rest on any administration in power at the time and so should not be personalised.
The minister said: “By the time the PIB is fully articulated and implemented, the current President and Minister of Petroleum Resources may no longer be in office. This Bill takes a while before it is operational.”
Drawing a parallel between the PIB and the Power Sector Reform Act of 2004, which was passed over eight years ago and is currently being implemented by the Jonathan administration, Alison-Madueke argued that it was important for the law to sufficiently empower any administration to act in the best interest of Nigerians.
She said that the proposed transition period after the passage of the Bill is at least three years, adding “note that there are over 80 regulations to be made for this Bill to be operational.”
According to her, “while we take best practices from other developed regions, we should also work within the understanding of our own socio-economic and social-cultural norms and create entities and policies that will work and are not destined to fail from the word-go.”
Commenting on the reported enormous discretionary powers granted to the Petroleum Minister in the PIB, Mrs. Alison-Madueke explained that the so-called powers were not different from those vested on the Minister’s counterparts by the petroleum laws of the United Kingdom, Malaysia and Norway.
She stressed that the powers granted the Nigerian Minister by the PIB is less than those of her counterparts in the laws of advanced petroleum producing countries.
Mrs. Alison-Madueke stated that the PIB establishes a flexible fiscal regime that will increase government revenues and yet encourage investment in the petroleum sector, noting that it allows for production-based incentive system, which in the long run will accommodate every player in the industry.
On regulatory bodies
Addressing the concerns on the provisions for multi-faceted regulatory bodies in the PIB, the Minister said this was basically as a result of the complex nature of the industry, adding that an unwieldy, mammoth entity that hosts two separately run organisations is not a mode of efficiency and that the disaggregated regulatory system would enable speedy response to variety of issues that may arise from time to time.
On the issue of the Host Communities, the Minister noted that it was established to mitigate the human and environmental conditions in the region and to assuage the feelings of the host communities towards oil and gas companies.
She said: “The issue of host communities should not be personalised or politicised. Bear in mind that we expect to find oil in other parts of the country, especially in the inland sedimentary basins in the years ahead.”
*NNPC press release