Reps to pass PIB into law in April — Gbajabiamila
By Akinyemi Kehinde
Stakeholders in the oil and gas sector of the Nigerian economy Wednesday took turns to highlight the significant good inherent in the proposed Petroleum Industry Bill (PIB) currently undergoing legislative scrutiny in the national assembly.
The Speaker of the House of Representatives, Femi Gbajabiamila assured that the bill would be passed into law in April this year.
The stakeholders which included the Minister of State for Petroleum Resources, Chief Timipre Silva, the Group Managing Director, GMD, of the Nigerian National Petroleum Corporation (NNPC) Mele Kyari and the Chairman of the Federal Inland Revenue Service (FIRS) Mohammed Nami said that bill when promulgated into law would promote economic growth and bring about the needed vigour and transparency that would in turn engender productivity in the petroleum industry.
Sylva thanked the members of the House of Representatives for their work on the Bill so far.
He said, “The effort to pass the PIB must be sustained and finalised. The world has changed significantly since the efforts for reform started.”
The Minister emphasised the challenges of energy transition and the urgency of passing the PIB.
“I am available to assist in any way that I can,” he said.
NNPC GMD, Mele Kyari said, “Oil will still be relevant in another 30 years. The uses will change but oil and gas will still be relevant.”
“Only countries that can harness the resources in an efficient way will prosper. The time is now.
“We have not seen any significant investment in the oil and gas industry since 2000 as there has been no fiscal stability. Our current fiscal environment is uncompetitive. We have made significant improvements in the PIB and there is still room for improvement.”
Chairman of OPTS – Mike Sangster, said only $3billion out of $70 billion invested in Africa was invested in Nigeria, stressing that operating costs in the country is over 40 per cent higher than competitor countries;
He said PIB does not provide a favourable environment for future investments, maintaining that the Bill should grant full royalty relief for the first five years for deepwater
According to him, “PIB must honour existing contractual obligations. Operators should be allowed to retain their existing license areas. Segregation of upstream and midstream assets under the PIB should not apply to past investments; PIB needs to include a robust dispute resolution process;
“Royalties should not be included in calculating the cost price ratio. PIB does not broadly support the growth of indigenous oil companies.”
Chairman FIRS, Muhammad Nami, said, tax administration would change significantly and will increase fiscal administration. FIRS is able to rise up to the challenge.
“There will be a reduction in tax revenue in the short term, which will be compensated in the mid to long term by increased investments;
“OPTS concerns on capital allowance has been raised with the executive committee and has been addressed.”
In his own submission, President of the Nigerian Labour Congress (NLC), Comrade Ayuba Wabba suggested the creation of Nigeria Oil and Gas Commission as against two Commissions Offshore and Onshore Regulatory Commission for Upstream and Downstream stated in the bill.
“Section 11. Governing Board of the Commission (1) There is established a Governing Board (the “Board of the Commission”) which shall be responsible for the policy and general administration of the Commission. (2) The Board of the Commission shall consist of the following members – (a) one non-executive chairman; (b) two non-executive commissioners (one of which shall represent Labour); (c) the chief executive of the Commission (the ‘Commission Chief Executive’); (d) two other executive commissioners who are responsible for Finance and Accounts and Exploration and Acreage Management; (e) one representative of the Authority not below the rank of a director; (f) one representative of the Ministry not below the rank of director; and (g) one representative of the Ministry of Finance not below the rank of a director (h) one representative of Labour of cognate qualification). (i) The Commission shall be known as Nigeria Oil and Gas Commission.
“Critical stakeholders in the oil and gas industry must be represented in the board. This is against the backdrop of the numerous collective bargaining agreements (CBA) for oil industry remuneration and championed by the industrial Unions affiliates of Congress like NUPENG and PENGASSAN counterpart,” he said.
