The Nigerian Association for Energy Economics (NAEE) has called for more clarification on the 30% NNPC Limited transfer of oil and gas profit to frontier exploration in the just-passed Petroleum Industry Bill (PIB).
This was charge was made known by the Association’s President, Prof. Yinka Omorogbe, at the 14th Annual Conference of the Nigerian Association for Energy Economics in Abuja on Monday.
According to her, “In this season of change, we cannot be left behind. We cannot be the country that remains frozen in debilitating discussions on whether or not a Bill that will provide a new legal framework for the petroleum industry must pass or not because of controversial clauses that can be amended.
“As the nation debates the Bill, it is necessary to focus on its actual contents and not on interpretations that are not always supported by fact.
“It is important for those who can, to come out with actual numbers and eschew the present discussions on percentages, based on the perception that they refer to the same thing when in fact they do not.
“Daily we hear about three per cent as against 30 per cent,” querying the rationale behind the three per cent.
She urged those at the helm of affairs that clarification on the 30% rate needs to be brought upon, as the number was expected to be 10% for frontier development, not 30%.
Section 9(4) of the House draft of the PIB states that the Frontier Exploration Fund shall be 10% of rents on petroleum prospecting licences and 10% rent on petroleum mining leases; and 30% of NNPC Ltd’s profit oil and profit gas as in the production sharing, profit sharing and Risk service contracts, which would be to all Basins and undertaken, simultaneously.
Section 9(5) states that NNPC Limited shall transfer the 30% of profit oil and profit gas to the frontier exploration fund escrow account dedicated for the development of frontier acreages only.