PIB Passage To Spur Investement In Oil Industry- Experts

…Engender Transparency, Competition

Joseph Bakare/Yemisi Izuora

The Director General of the Lagos Chamber of commerce and Industry, LCCI, Muda Yusuf, has reacted to the passage of the long awaites Petroleum Industry Bill, PIB, saying the oil and gas industry is a major contributor to the Nigerian economy and government revenue and as such should be freed from political interference.

Yusuf said that Nigeria, with the largest oil and gas reserves in Africa, has huge untapped potential to achieve its economic development goals including gas-to-power ambitions, but the investments are not coming in the absence of fiscal policies that will stimulate investment.

Nigeria despite having the largest reserves in Africa, Nigeria only received 4 per cent ($3 billion) of $75 billion invested in the continent between 2015-19.

According to Yusuf, this underscores the need to create a competitive environment to attract investment to the oil and gas sector.

The fundamental shift in global energy markets driven by advances in unlocking unconventional petroleum resources and increasing traction for cleaner energy sources has resulted in a global oversupply of crude oil, putting pressure on prices.

This has been further worsened by the COVID-19 pandemic, potentially putting at risk the viability of ongoing and future projects and driving fierce competition for scarce investments around the world.

Nigeria’s petroleum industry faces many country-specific challenges including Joint Venture Funding and Arrears, regulatory overlaps, insecurity and inadequate infrastructure for domestic gas development, which the Bill will resolve.

He said the Chamber is fully supportive of the Government’s efforts to drive industry reform through the Bill which among other things will reform the institutional and fiscal framework, develop Nigeria’s gas sector further, create a framework to support the development of host communities and foster sustainable prosperity, and further bring in new investments to grow the country’s production capacity

The current Bill, Yusuf pointed out marks positive steps toward achieving its stated goals.

The Bill mandates that ministries, departments, and agencies to consult with the Commission prior to introducing overlapping legislation which will impact the oil and gas industry. It also allows for consultation with industry stakeholders before making regulations.

The commercialisation of NNPC aims to improve business efficiency and effectiveness, especially in relation to Joint Venture activities, he added.

Oriental News Nigeria reports that the Senate on Thursday passed the Petroleum Industry Bill (PIB) with the approval of three percent for host community trust fund as against five percent recommended by the Joint Committee of the National Assembly on Petroleum (Upstream and Downstream) and Gas in a report presented last week.

The percentage for the host community became contentious at plenary as the Senate reduced the percentage from five to three percent after a heated argument.

The Senate Leader, Senator Yahaya Abdullahi, thereafter moved a motion for the Bill to be read the third time and Senate Passes PIB, Approves 3 per cent for Host Community Trust Fund.

This was seconded by Senate Minority Leader, Senator Enyinnaya Abaribe after a clause by clause approval by the upper legislative chamber.

Senate had before then, held a closed session with the Minister of State for Petroleum, Timipre Sylva and the Group Managing Director of the Nigerian National Petroleum Corporation, Mele Kyari.

Senate President Ahmad Lawan congratulated the lawmakers and said the 9th National Assembly has achieved one of its fundamental legislative agenda.

“The demons have been defeated in this Chamber. We have passed the bill,” he said.

 

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