Mixed reactions trail passage of PIB
…Passage to attract investors into Oil & gas sector —Sylva
…Wike raises concern over benefits to host communities
By Uthman Salami and Matthew Denis, Abuja
Mixed reactions on Thursday followed the senate long-awaited passage of the Petroleum Industry Bill (PIB) as final document of the bill were not disclosed to key stakeholders that clamoured for its early passage.
The bill was passed by the senate following its approval of recommendations of the report by Joint Committee on Petroleum, (Downstream) Petroleum (Upstream) and Gas at plenary on Thursday.
Our correspondent can report that the PIB bill was the first in a series of long awaited petroleum industry laws designed to reform the oil and gas industry.
The PIB is an omnibus law, meant to regulate the entire sphere of the industry and repeal all current existing oil and gas legislations.
It struggled to see the light of day in spite of its introduction to the National Assembly over 16 years ago.
Speaking on the passage of the PIB on Channels Television Politics Today, The Minister of State for Petroleum Resources, Chief Timipre Sylva said that the passage has helped to remove uncertainties surrounding investment in the nation’s Oil & gas sector.
He noted that with so much uncertainty in the investment environment, Nigeria was unable to attract investment in the Oil & Gas sector for several years.
He noted that International Oil Companies (IOCs) were not investing in the country.
According to him, “Even the IOCs were not investing in Nigeria because they took sit-down look approach. We had bid rounds in 2007 and IOCs in Nigeria did not participate in those bid rounds because investment environment was uncertain.
“Everybody was watching and today we have passed the law. It is time. Everyone will look at the physical environment, and look at the number and decide to invest in Nigeria.”
Speaking from a different perspective, the Rivers State Governor, Nyesom Wike, raised concerns over welfare of host communities, maintaining that the stakeholders in Oil producing states have not seen total package of the bill passed by Senate.
In his words, “Our own contention is what will be the benefits of the host community.
“We have not seen the total package. When we know this, we will know how to react. It is too early to take a position.”
Key stakeholders who spoke with our correspondent also expressed concerns on the details of PIB passed by Senate.
They expressed that if effectively passed, the sector tends to benefit tremendously.
The chairman, International Energy Services, Dr. Diran Fawibe said, “It is good news to the Oil & gas sector and nation’s economy.
“After so many years in the making. It is now time to look at and scrutinize the provision in whichever way is going to benefit Nigerians.
“But at least, what people have been waiting for to drive investment in the petroleum industry— with a multiplier effect on the economy—and also promote transparency and accountability is now here.
“So I believe it will have positive effect on the operation in the petroleum industry and Nigerian economy.”
The President, Oil and Gas Trainers Association of Nigeria (OGTAN) Mazi Onyechi, said, “It is a beautiful thing the bill was passed by the senate today.
“It is going to be an enhancement of what the local content has started doing by encouraging Nigerian participation in the industry.
“But I need to see the details of what they finally passed. From the initial brief we had, I believe is something good for this country and for local content as well especially Nigerian participation in the industry and our economy generally. It is a move in the right direction.”
Also speaking, the Chairman, Major Oil Marketers Association of Nigeria (MOMAN), Mr. Tunji Oyebanji, called on the Senate to disclose the full details of the passed PIB bill.
In his words, “We should be allowed to see what has been passed. This is because when we went to Abuja to make submission to the Senate and House of Reps, we did not hear anything since that time until today.
“We need to know all the details in the bill. The only thing we can say right now is that it is a milestone after all these years. But whether it is good for the industry or not, we will have to wait and see.”
Depot and Petroleum Products Marketers Association (DAPPMA), Executive Secretary, Olufemi Adewole in a chat with Nigerian NewsDirect said, “It is a good thing that the bill has been passed, but we will need to see what the content of the bill.
“This is because we hear that so many amendments have been included in the bill, so we really need to know what was eventually passed.”
In addition, Oil & gas expert, Mr. Bala Zakka stated that, “It is better late than ever. But in terms of positive crystalization, it will add little or nothing.
“All the investors that had been here for the past 10 years have moved to safer, cheaper, and better environments.
“I should not say it is almost dead on arrival because I’m patriotic citizen.
“The delay has caused economic losses and calamity. During the previous dispensation, Diezani produced a 283-page document but immediately her tenure passed, the administration balkanized the bill into four.
“They came up with Petroleum Industry Governance Bill, Petroleum Industry Host Community Bill, Petroleum Industry Technical Regime and Administration Bill. They did all these for vengeance and emasculation to rubbish the previous regime.”
Presenting the report, Chairman of the committee, Sen.Mohammmed Sabo (APC-Jigawa), said the bill consisted of five distinct and logically connected chapters.
Sabo listed the chapters to include governance and institutions, administration, host communities development, petroleum industry fiscal framework and miscellaneous provisions, comprising 319 clauses and eight schedules.
He said the committee carried out its assignment effectively and conducted a public hearing to collate inputs from critical stakeholders and the Nigerian people.
Sabo said the committee reviewed the bill and all the memoranda submitted by stakeholders during the public hearing adding that the committee also embarked on on-the-spot assessments of impacted oil exploration communities.
This, he said was to critically examine issues raised by Senators during the second reading of the bill and consulted widely on the justifications for passing the bill into Law.
Sabo said the bill when passed into law “will strengthen accountability and transparency of Nigerian National Petroleum Corporation(NNPC) Ltd as a full-fledged CAMA company under statutory and regulatory oversight with better returns to its shareholders and the Nigerian People.”
On the Frontier Basins, he said the committee’s recommendation recognised the need for the country to explore and develop the country’s frontier basins.
This, he said was to take advantage of the foreseeable threats to the funding of fossil fuel projects across the world due to speedy shift from fossil fuel to other alternative energy sources.
“To this end, the committee recommends funding mechanism of 30 percent of NNPC Ltd profit oil and profit gas as in the production sharing, profit sharing, and risk service contracts to fund exploration of frontier basins,” Sabo said.
On host communities’ development, he said, “To ensure adequate development of the host communities and reduction in the cost of production, the Joint Committee recommends five percent of the actual annual operating expenditure of the preceding financial year in the upstream petroleum operations affecting the host communities for funding of the Host Communities Trust Fund.”
According to him, in the past 10 years, the country has only attracted less than five percent of the over 100 billion dollars capital investment inflow into Africa’s oil and gas industry.
He added that all stakeholders were in total support of the passage of the bill as there was no dissenting voice opposing its passage.
He described the bill as laudable and commendable saying that its passage would bring the long awaited change in the oil and gas industry.
However, Sen.Ahmed Baba Kaita (APC-Kastina) moved a motion for the reduction of funding of host community trust fund to 3 percent as against the 5 per cent earlier recommended by the committee.
The motion which was adopted, resulted to dissenting views by senators James Manager(PDP-Delta),Bassey Akpan(PDP-Cross-River), George Sekibo(PDP-Rivers) among others.
Sekibo, having cited order 17 of the Senate rule called for division to contest the decision to reduce funding of host community trust fund to 3 percent.
However, Leader of the Senate, Abdullahi Yahaya (APC- Kebbi) said the call for division was not in the interest of the Senate and the nation, describing the situation as heading for “Armageddon.”
He called for a withdrawal of the call for a division in the Senate, saying that the senate in its two years of existence had worked in a peaceful and a bipartisan manner.
He urged the Senate to increase the funding for host community trust fund given the economic contributions of the people of Niger-Delta over the years.
According to him, no amount is too small for the people of the region.
President of Senate, Ahmad Lawan, prevailed on Sen. George Sekibo to rescind his earlier call for division.
“The Senate expects President Muhammadu Buhari to assent to the PIB after harmonisation with the House of Representatives,” he said.
