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Why we support Petroleum Industry Bill – TUC

By Victor Ahiuma-Young
TRADE Union Congress of Nigeria (TUC),     says aside the obvious shortcomings and loopholes identified by interest groups on the Petroleum Industry Bill (PIB), the body believes the bill   seeks to address the injustices and inequities in the Niger Delta by providing for a comprehensive Corporate Social Responsibility, (CSR), package for the oil_producing communities by companies operating in the region.

The umbrella body for senior staff association in the country, argued in a statement that there is also stringent provisions for local content which stipulate that oil companies must train and employ members of host communities.

TUC in the statement issued by its President-General and Secretary-General, Comrade Peter Esele and Chief John Kolawole, respectively said: “We also believe that the PIB will promote transparency in the oil and gas sector through the removal of all clauses that encouraged confidentiality in business transactions in the petroleum sector. Nothing guarantees investors’ confidence more than transparency which is in conformity with international best practices.

The congress also notes that the proposed law is a consolidation of the extant laws in the industry. It is not within its scope to review the provisions of the 1999 Constitution as regards the ownership of petroleum resources in the country. Such a review can only be undertaken in a Constitutional Amendment which is obviously outside the purview of the Bill. We are therefore of the opinion that opponents of the bill should channel their efforts towards the constitution amendment committee. We also note that the provision in the Bill for the funding of the institutions and agencies is only designed to make them financially independent.

This does not, in any way, remove the budgetary powers of the National Assembly to appropriate funds for them in line with the 1999 Constitution.” “TUC do not buy the idea that members of the board of directors of the proposed national oil company, NNPC Ltd, would become more powerful than the President. How can a company owned by the government which appoints its board of directors be more powerful than the President?

The PIB proposes that the Incorporated Joint Ventures (IJVs) would become a limited liability company that could source its funds locally and internationally without waiting for Government funding. The Monies which is normally accrued as cash call obligations could now be used to take care of other social and infrastructural needs of Nigeria. The IJVs would run independently with their own Board of Directors under the Company and Allied Matters Act.

The proposed NNPC Ltd as a limited liability company would become more efficient and transparent. This would make it more accountable and profit_oriented for the benefit of Nigerians. The Bill we also acknowledge provides that Government would no longer fund any operations in the industry as both the IJVs and the NNPC Ltd would run as profit centers to generate money for their various shareholders.”

The body posited that “The entire fiscal provisions in the Bill ranging from the new regime of royalties and rents to the Petroleum Profit Tax, the Company Income Tax and the Hydro Carbon Tax, are all geared towards increasing revenues accruing to federal government. All these would naturally be paid into the Federation Account as stipulated in the 1999 Constitution.

This we know will reduce corruption to its barest minimum. TUC also acknowledges one thing, that the PIB seeks to rectify the existing situation where a large quantity of gas in the country is flared and the other exported without adequate supply to the local market. The Bill frontally addresses this issue by making provisions for specific percentage of gas produced by local and international oil companies to be reserved for the local market to power local industries and for power generation among others.”

“It must be stated that the PIB is simply an attempt to create a legal framework that would provide transparency and enhance efficiency in the management of our oil and gas resources for the benefit of Nigerians and for its generation yet unborn. We must resist the temptation of politicizing this all important piece of legislation. What we should do is to question individuals who will emerge to manage our resources when that time comes. TUC will forever champion causes that will benefit the ordinary Nigeria from a holistic and civilized point.”


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