Investors interested in entering into Nigeria’s oil sector should be heartened by the news that the Nigerian government is pushing ahead with the move to loosen state-owned Nigerian National Petroleum Corporation’s grip on the oil industry.
The Upper Chamber of Nigeria’s National Assembly has passed the controversial the controversial Petroleum Industry Governance Bill (PIB) 2016, first introduced to the National Assembly in 2008, for second reading.
Amongst a host of issues, the bill seeks to create efficient and effective institutions with clear and separate roles for the petroleum industry.
The Chairman, Senate Committee on Petroleum (Upstream), Tayo Alasoadura, (APC, Ondo Central), who led the debate on the Bill, said that his committee had taken steps to eliminate the encumbrances that frustrated the passage of the initiative in the past years.
Alasoadura said the existing NNPC would be unbundled into two commercial entities limited by shares, which are, the National Petroleum Company (NPC) and the National Assets Management Company (NAMC).
According to him, the proposed NPC will operate as a commercial entity in order to ensure efficiency across the value chain while the NAMC shall ensure maximum value for the federation through prudent management of its oil and gas investment. He also noted that the Petroleum Minister, in the new bill, shall be responsible for policy formulation and supervision of the petroleum industry on behalf of the federal government while a commission to be known as the Petroleum Regulatory Commission (PRC) would be created and saddled with regulatory functions over the industry.
The PRC, according to him, shall be the industry regulator and watchdog, responsible for licensing, monitoring, supervision of petroleum operations, enforcing laws, regulations and standards across the value chain. He explained that the committee decided to split the document into different components, as a means of ensuring that the controversial elements in the bill did not stop its passage as the case was in the previous assemblies.
The lawmaker lamented that the failure to pass the bill by past assemblies had denied the country huge investment opportunities as well as kept the country in the limbo as the oil and gas leader in sub-Saharan Africa.
His words: “The current effort has adopted a method of splitting the PIB into logical smaller pieces for submission to the 8th National Assembly, a complete departure from all prior attempts.
This way, the individual elements can be expeditiously considered and passed one after the other and where amendments are required in the future, the relevant bill can be separately considered. Several senators spoke in favour of the passage of the bill. In his remark, the President of the Senate, Bukola Saraki, commended his colleagues for their support for the bill and nonpartisan stance they took on the matter.
Sourced from New Telegraph and edited for African Mining Brief Online