Buhari: Urgency of New Petroleum Industry Law

Posted by News Express | 22 October 2016 | 1,974 times

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Since assuming office over a year and half ago, President Muhammadu Buhari has made the Niger Delta affairs one of the pillars of his administration, even as he has struggled to bring stability and peace in the crude oil-rich region, which has once more been hit by insurgency.

President Buhari has had to face the major issue of resurgence in agitations by the youth of the crude oil-rich Niger Delta region clamouring for greater inclusion and control of the activities that goes on in the crude oil sub-sector of the economy.

Prior to the inauguration of the current administration last May, previous civilian administrations have had to confront the challenge of enacting a nationally-acceptable legislation that could cede greater benefits to the crude oil-producing communities from the commercial entities that run these exploration businesses. But these efforts have largely come to naught; and tons of billions of public fund have been frittered away by legislators who endlessly debated the merits or otherwise of this piece of law in the last eight years or more.

Even as I write, the bone of contention that created the near-state of war in the Niger Delta is the deep-seated angst by the people over the existential fact that virtually 90 per cent ownership of oil wells domiciled in their region are controlled by others who are not from their immediate communities.

Under the law of natural justice, I think this deliberately skewed ownership pattern of crude wells, which favours northerners, is unjustifiably unsustainable in the long run. There is this allegation that, for instance, the previous military despots used military fiats to allocate oil bloc licenses to their cronies’ fronts from the North.

Sometime last autumn, a wealthy crude oil well owner from Borno was reported in the American press to have made stupendous donation to the university in which his daughter had just bagged a college degree abroad. This same man is not known to have donated one kobo to any of the public universities in the oil-producing communities in the Niger Delta, from where he makes all is wealth. The story of the Borno man who controls oil wells in Niger Delta that chose to fritter some of the easy money in the Western world constitutes grave point of the renewed agitations by Niger Delta militants who are responsible for several bombing campaigns that have crumbled several crude oil facilities run by (joint venture) multinational companies, thereby shutting off nearly 40 per cent of Nigeria’s daily production quota allotted to it by the Organisation of Petroleum Exporting Countries (OPEC) and, by extension, drastically cutting down Nigeria’s foreign revenues.

Buhari’s Minister of Budget and National Planning was recently quoted as blaming the bombing of crude oil facilities in the Niger Delta for the economic recession that has befallen the nation since this government came on board.

Before President Buhari’s administration, other civilian governments tried unsuccessfully to enact the Petroleum Industry Bill (PIB), which would have dramatically taken care of some of the issues of the agitations for greater ownership by the people whose environment rich with crude oil resources have almost been completely devastated. The PIB is a proposed legislation which, if passed could become, in the estimation of experts, the master reference law that governs Nigerian petroleum industry – from the upstream division (exploratory, development and production activities) through the midstream (gas-processing) to downstream (servicing, refining, distribution, transportation, marketing/retailing).

From the website of www.newsheadlines.com.ng ,we were told that shortly after Chief Olusegun Obasanjo assumed office in his first term as President, he set up a committee called ‘Oil and Gas Committee (OGIC), with a mandate to take a comprehensive look at Nigeria’s oil and gas sector and offer better ways of managing the industry.

Analysts observed that many of the laws and regulations guiding the industry had been around for long; some far back as 1950s, and although they had undergone amendments, the Federal Government considered it necessary to take a holistic review of the industry with a view to getting the best of it by all stakeholders. The OGIC was led by Engr Rilwanu Lukman, veteran petroleum minister and former Secretary-General of the Orrganisation of Petroleum Exporting Countries (OPEC), and had other oil industry eggheads. The committee submitted its report, and its recommendations formed the basis of Petroleum Industry Bill, which has since been subjected to further reviews and adjustments.

The bill seeks to: Create a conducive business environment for petroleum operations; enhance exploitation and exploration of petroleum resources in Nigeria for the benefit of Nigerians; optimise domestic gas supplies, especially for power generation and industrial development; encourage investment in Nigerian petroleum industry; optimise government revenue; establish profit-driven oil entities; deregulate and liberalise the downstream petroleum sector; create efficient and effective regulatory agencies; promote the development of Nigerian content in the oil industry; and protect health, safety and the environment in petroleum operations.

Observers are indeed bewildered that this singular bill that could take care of all the issues that give rise to agitations and restiveness in the crude oil-rich Niger Delta has taken several years without seeing the light of the day. Sadly, many legislators are milking the country dry through meaningless voyages of public hearings and visits to the crude oil-bearing communities. In a policy brief issue of October 2, 2016, the Nigeria Extractive Industries Transparency Initiative (NEITI) had stated concerning the ill-fated Petroleum Industry Bill: “The failure of Nigeria to pass an over-arching law for the petroleum sector after repeated attempts continues to accumulate huge costs for the country, estimated at more than $200 billion."

NEITI expressed optimism that the advent of a new administration on 29 May 2015, expectedly, triggered a flurry of activities and expectations around the passage of the much-anticipated Petroleum Industry Bill. These activities and expectations, NEITI noted, will reasonably pick up again as the 8th National Assembly returns to session this month: the Petroleum Industry Governance Bill (PIGB) introduced in April and stepped down in June by the Senate might come back on stream; at least two private members’ bills from the House of Representatives and three separate bills from the executive arm might be introduced. The Senate president had during a visit to the Kwara State governor in July promised that the PIB would be given accelerated attention. But even the last session of the National Assembly gave such reassurance, but nothing was done to make it a reality.

NEITI also said the plurality of action on the petroleum sector law is good, but might be misdirected. "Though eight years in the National Assembly, the motion around the PIB has been on for all of 16 years. Sadly, there is little about what is going on at the moment to suggest real movement or adequate learning from the past. The PIB ship should be rescued from a start-stop, unhurried and uncoordinated mode and brought swiftly ashore."

The agency which is now headed by a professional media practitioner, Mr Waziri Adio, appealed to the current government thus: “There is need for President Muhammadu Buhari to take the lead by investing his presidential capital on this all-important legislation, putting in place a mechanism for rallying the stakeholders to a consensus, and using this law as one of the pillars of the bridge to a much-needed economic recovery.”

Citing Ghana’s recent experience with the passage of its petroleum sector law, NEITI affirmed that it ironically offers lesson points in urgency and co-ordination. NEITI said:

"To be sure, Ghana is a new oil country and the issues around its petroleum sector are not as complicated as Nigeria’s. In November 2014, the Petroleum Production and Exploration Bill was submitted to the Ghanaian Parliament. Shortly after, the bill was withdrawn to reflect new realities and re- presented in June 2016. On 4th August this year, less than two months after, the bill was re-presented. And less than two years after the whole process started, the bill was passed by the Ghanaian Parliament.

“By contrast, Nigeria has been on a perpetual voyage with its own PIB. That journey began 16 years ago with a lot of anticipation and promise. But four presidents, five presidential terms and five legislative tenures on, the bill is still stuttering through legislation. It is perhaps one of the most important bills ever to be contemplated in Nigeria’s history, yet the one that has taken the most time and generated the most activity without legislation.”

“The PIB has suffered repeated setbacks due largely to disagreements among stakeholders. These disagreements have centred mostly around the regulatory framework, including power of the minister, ownership and control of the resources, host community benefits, environmental concerns, appropriate fiscal regime, etc. In the process every administration has produced its own PIB draft(s), but not the law. Each PIB process has ended with each administration, to be restarted almost from scratch by the succeeding government.”

I think President Buhari should make it a point of duty to partner with the National Assembly in other to more robustly push for the passage of the Petroleum Industry Bill into a law of the Federal Republic of Nigeria. Enough of these jokes by the National Assembly.

RIGHTSVIEW appears on Wednesdays, in addition to special appearances. The Columnist, a popular activist, is a former Federal Commissioner of Nigeria’s National Human Rights Commission and presently National Coordinator of Human Rights Writers’ Association of Nigeria (HURIWA). He can be reached via 08033327672 (sms only) or via doziebiko@yahoo.com

Source: News Express

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