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PENGASSAN insists on passage of petroleum bill

By Oscarline Onwuemenyi
ABUJA -The Petroleum    and Natural Gas Senior Staff Association of Nigeria, Department of Petroleum Resources branch, has called on the National Assembly to hasten the passage of the Petroleum Industry Bill in order to improve transparency and accountability in the oil and gas sector.

Dr Luckman
Dr Luckman

The Chairman of PENGASSAN, DPR branch, Mr. Aniekan J. Akpan, who made the call on Thursday at the 2nd Triennial Delegates Conference of the body, noted that the new law when passed, would grant more powers and autonomy to the DPR.

He said, “The passage of the Petroleum Industry Bill is the one-stop-shop for the empowerment and autonomy of the DPR to rectify the inadequacies and the faulty governance framework, especially in the regulation of the oil and gas industry.

“We therefore call on the legislators to empower the DPR to effectively power the nation by passing the PIB.”
Akpan said the passage of the bill “will not only ensure transparency, responsibility, efficiency and accountability in the oil and gas sector, but will also empower the department to implement the National Content Development Policy, as well as guarantee proper funding, capacity building, adequate staffing and also protect the environment and consumers against sharp practices by operators.”

He observed that the inadequate funding of the department was to blame for the dismal state of the nation’s oil and gas industry.

He said, “The effectiveness of the DPR has far-reaching consequences on the mono-cultural economy of Nigeria as well as faith in the governance; the highest allocation from government has never been sufficient to run the department effectively.”

Akpan, who stressed that only adequate funding of the DPR would guarantee effective monitoring of the industry, added that the funding should be structured to ensure its independence with budgetary appropriations subjected to legislative oversight and not attached to ministerial budgetary provisions.

“In addition to the allocation from the Federation Account, adequate funding can be achieved through charging and retention of some percentage for each barrel of crude oil fiscalised at the oil export terminals by DPR,” he stated.
DPR, he said, could also augment its revenue base by charging and retaining administrative and processing fees for licences and permits, and by retaining 10% of the funds accruing to the Petroleum Technology Development Fund, PTDF for the acquisition of technology.

In the meantime, the union has also criticized the recent contract for pre-shipment inspection services in the 21 crude oil terminals given to a foreign company, Cobalt International Services Ltd, describing it as a duplication of DPR’s functions.

According to Akpan, the contracting of 21 crude oil terminals for pre-shipment inspection to a foreign firm “is not only a form of balkanizing the functions of the DPR, but another form of economic leakage. It also goes against the seven-point agenda of the government to cut down unnecessary cost.”

The Federal Government approved a foreign firm, Messrs Cobalt International Services Ltd to carry out pre-shipment inspection services in the 21 crude oil terminals on a fee of 0.1% of freight on board, FOB, which, according to Akpan, they have over the years not allowed to be paid into the Federal Government purse through the DPR.

He said, “From time immemorial, this function has been statutorily performed by the Department of Petroleum Resources, the regulatory, monitoring and enforcer of set standards in the Nigerian oil and gas sector at no extra cost.
“The reports of several committees have consistently observed that the functions being contracted to the pre-shipment inspectors are nothing but a duplication of the DPR’s functions and a colossal waste of the nation’s insufficient resources.”

Further, the organised labour union urged the government to consider improving the capacity of staff so as to enable them cope with new technological advancement, thereby achieving the best international practices for the system through training and re-training of the personnel.

He added, “There is also the need to empower the department to ensure continuous enforcement and installation of provable metering skids on all flow stations and production platforms by the oil companies for which the compliance date of December 31, 2007 has long lapsed.”

PENGASSAN also demanded that the 0.1% fee on freight on board be paid to the department, even as they called for the withdrawal of the pre-shipment inspector from the 21 crude oil terminals and the cancellation of the contract.
It stressed that, “PENGASSAN (DPR branch) is not against Cobalt but we are standing up for the cause of our nation’s economy.”

On the state of insecurity in the Niger-Delta, the union regretted that the crises in the region had not abated and had led to several cases of kidnapping and attacks on their members and the destruction of oil facilities and installations.
It, therefore, charged the government to combat “bare faced criminality” within the area, even as it called for massive and rapid infrastructural and human capital development of the Niger-Delta region.


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