NewsExpress advert Yudala banner
Experts warn against amendment of NLNG Act, say implications for Nigeria would be devastating

By News Express on 21/08/2017

Share on facebook Yahoo mail icon Gmail icon Share on Google+

Views: 677


The Senate has been urged to consider the implications of the trade-off the country will make to amend the Nigeria LNG Act, which include foregoing $25 billion investments in LNG Train 7 and 8, loss of investor confidence in Nigeria and reputational risk for the country, as it prepares to consider the Act.

A panel session at the 2017 Association of Energy Correspondents of Nigeria (NAEC) conference held in the Eko Hotel & Suites, in Lagos last Thursday, saw an impassioned discussion by representatives of the private sector, the government and civil society, over the implications of the amendment of the NLNG Act by the House of Representatives in May.

“The first issue in this amendment is the timing. The Nigeria National Petroleum Corporation (NNPC) is currently negotiating Train 7 of the NLNG with various parties and when this started going round in the media, it put the NNPC on the defensive,” said Dolapo Oni, head of energy research at EcoBank.

“A bigger picture is that Nigeria needs to monetise its gas and the NLNG has proven to be the best vehicle to do so. Trains 7 and 8 are meant to provide at least 18,000 jobs, so the question is, what is the trade-off we are getting from here if paying the three percent annual budget to NDDC means that these investments won’t happen? Would paying (3% of NLNG budget to NDDC) have created the same amount of jobs and investments?”

Nigeria’s LNG could not kick-off after it was first proposed in 1968 because of the huge capital investment required, which Nigeria did not have. Investors wanted assurances and guarantees that they will recoup their investments. In 1990 Nigeria granted the investors a ten year pioneer status, as well as generous concessions that prohibited further taxation and levies.

But Nigeria’s lower legislative house, led by Leo Ogor, PDP, minority leader from Delta state, has amended the Act, so that NLNG pays three percent of its budget to NDDC and free Nigeria from guarantees and assurances it gave to its partners.

Leo Ogor is facing investigation by the Economic and Financial Crimes Commission (EFCC) for allegedly awarding constituency projects to his companies; failing to declare these companies in his Asset Declaration Form and payment of over N318 million into two of his companies accounts by the NDDC​ ​for undisclosed projects.

Nigeria established the Niger Delta Development Commission (NDDC) in year 2000 to cater to development in the region. The law mandated all gas producing companies to pay three percent of their annual budget to assuage environmental degradation in the Niger Delta. The contention is that some oil companies who formed the NLNG (NNPC, Shell, Total and Eni) already pay this levy to the NDDC. Between 2002 and 2016, Shell alone paid $1.2 billion to the NDDC.

Furthermore, the NLNG does not produce gas but processes gas already produced by the oil companies, otherwise meant for flaring, into a liquid form for exports.

But Simon Yakubu Arabo, PDP, member of the gas committee in the House of Representatives from Kaduna State, insist that the “NLNG, with all its pretentions, is a gas producing company and the National Assembly has a duty to bring it in conformity to the constitution.”

“Those that have been saying we should not tamper with the NLNG Act, which basically is saying this law is here forever, we cannot allow that. There is nothing like a law in perpetuity, it does not happen anywhere in the world. You cannot have an act and say no one can touch it, we are a sovereign nation and we are duty-bound to review agreements that appear to short-change our common patrimony.”

However, through the NLNG, Nigeria’s patrimony has actually grown by $15 billion in dividends paid to the government. For the past six years, NLNG has paid over $5billion in taxes and employed 2,000 Nigerians directly and another 18,000 through vendors and contractors. NLNG contributes 4% to Nigeria’s GDP.

The NDDC has made significant strides in developing the Niger Delta, providing capacity development for close to 10,000 youths across the region, constructing over 5,000 km of roads and connecting hundreds of rural communities to the national grid. But many projects have also been abandoned by the admission of Nsima Ekere, its managing director.

Arabo further said: “If we can amend the constitution of the country, what is so special about an act setting up an entity? They have had tax holidays for more than 16 years, what more are they looking for?”

However, Kudo Eresia-Eke, General Manager, External Relations, NLNG, refuted this assertion, saying that the NLNG has been paying taxes for the past six years.

Tokunbo Mumuni, executive director, Socio-Economic Rights and Accountability Project, (SERAP) asked about the impact NDDC operations on the citizens.

“Previous contributions to the NDDC where are they and what has been the impact on the people? We should not just be concerned about companies paying levies, but judicious use of the funds collected from the companies is what is most prominent.”

Victor Eromosele, a former chief financial officer of NLNG said, “Rather than squabbling over this pie, why not bake a bigger pie? What signal does this decision by legislators send to investors? It simply says, Nigeria cannot keep its word. “We are talking about ease of doing business and this amendment is certainly against the spirit,” Eromosele said.

•Text courtesy of Business Day.

 

Source News Express

Posted 21/08/2017 5:42:52 PM

 

Share on facebook Yahoo mail icon Gmail icon Share on Google+


 

CLASSIFIED ADS

Let us build the most comprehensive online database of worthy and credible Nigerians from all walks of life. It is worth doing!

Loss Off Your Belly Fats, Upper Arm Fat and Body Fats In 2weeks Time.. Click HERE To Start Now!

 

You may also like...
BREAKING NEWS: INEC gets new Chairman

Nembe condemns militants’ attack on military post, killing...

Nigeria, Morocco sign 21 trade agreements

House for sale — with free wife

Lagos APC blasts Aso Rock, says austerity measures...

Release of suspected killers of Abuja female pastor...

Shi’ites protest non-release of Zakzaky after expiration of...

NiMet predicts dust haze, cloudy skies for Monday...

Biafra: Court orders Abaribe to produce Nnamdi Kanu...

Fraudulent activities going on in Buhari’s government —...

BREAKING NEWS: Niger Delta Avengers blows up NNPC...

Youths bemoan abduction, killing of British aid worker...

 

Latest News BREAKING: Soldiers rescue abducted Yobe schoolgirls inside bush Monkeys swallow Northern Senators’ N70m Yobe Police Commissioner confirms 111 school girls missing after Boko Haram attack Paedophile bags 60-year jail with hard labour as Lagos Sexual Offences Court delivers first judgment Charlyboy leads protest to NNPC HQ over fuel scarcity FG commences investigation into Dana Air mishap UBA Foundation builds link bridge for students of Usman Danfodiyo University Save Lagos Group drags EFCC officials before Magu over alleged harassment of businessman Veteran journalist and Columnist Tola Adeniyi set to present ‘In the Belly of Vultures’ Tinubu, Ambode, Lai Mohammed, Saraki, others to receive IPI chief ahead world congress in Abuja HURIWA blasts El-Rufai for demolishing Kaduna APC factional secretariat •Condemns FG’s clampdown on free speech Morgan Tsvangirai: The African Hero

 

Most Read Nigerian female sex addict opens up, says ‘I like it with both men and women’ (325,905 views) NUDE PHOTO OF OMOTOLA JALADE-EKEINDE surfaces online (317,539 views) Shameless Genevieve Nnaji exposes breasts in public (254,241 views) Finally named: The full list of friends of Nigerian female sex addict who prowled Facebook (208,543 views) Igbo scholar disgraces Femi Fani-Kayode •Demolishes claims on Igbo/Yoruba history with facts and figures (194,575 views) OLUMBA OLUMBA OBU (the one who called himself God) IS DEAD (187,449 views) Breaking News: POPULAR REVEREND CONVERTS TO ISLAM in Kaduna (Nigeria) (163,103 views) OBJ’s son reported dead in Lagos plane crash •Names of more victims emerge (146,401 views) THE FINAL DISGRACE: Igbo scholar unleashes more facts about Igbo/Yoruba history, finishes off Femi Fani-Kayode with second article (140,237 views) Lagos plane crash: Journalist releases victims’ names (129,331 views) My wasted years in Olumba Olumba Obu’s Evil Brotherhood (127,846 views) Gunmen kill ASP, 2 other police officers in vain bid to kidnap Rivers PDP chieftain (122,981 views)

 

Categories Advertorials (3) African Press Organisation (81) Art & Literature (34) Business (2,897) Business Verdict (33) Columnists (804) Complaints & Requests (94) Enterprise & Opportunities (203) Entertainment (446) Features (549) Global Business Monitor (226) International (1,799) Interviews (143) Live Commentary (28) Love Matters (105) News (33,009) Opinion (883) Pidgin (10) Politics (4,510) Religion (681) Sports (1,438) Stock Watch (28) AMA & Al Jazeera Global Update

 

 

Football president George Weah puts Liberian army to the test

 

APO Group Partner

 

CLASSIFIED ADS

Let us build the most comprehensive online database of worthy and credible Nigerians from all walks of life. It is worth doing!

Loss Off Your Belly Fats, Upper Arm Fat and Body Fats In 2weeks Time.. Click HERE To Start Now!

GOCOP Accredited Member

GOCOP Accredited member

 

 

Africa Media Agency and Al Jazeera

Advertisement