By Bashir Adefaka
On January 20, 2012, the Minister of Petroleum Resources, Mrs Diezani Alison-Madueke, set up a Special Task Force on Governance and Controls in NNPC and other Parastatals within her ministry.

This, according to the permanent secretary in the ministry, was done in line with Diezani’s commitment to reform and transform the Nigerian petroleum industry.

In the light of many challenges facing the national economic life and what has been generally expressed as lack of transparency and accountability in the management of NNPC, and even the foot-dragging by the ministry to effectively cleanse the oil sector of corruption, Madueke’s new move could, understandably, be said to be a right step in right direction.

Petroleum Minister, Alison-Madueke

But industry analysts believe that the minister has not done enough to holistically transform the industry. They hing their position on the adage that says: “Without the past there cannot be present, and without the present there cannot be the future.”

They argued that Madueke still has a lot to do if she wants well-meaning Nigerians to buy and key into her transformation programme in the petroleum industry.

Realistic economic future

She is being asked to take a cue from past developments with a view to seeing how things were done and use them as a platform for forging ahead into a more realistic economic future for the good of all Nigerians.

According to them, at a time when both economic and security challenges are interwoven thereby complicating the Nigerian situation, government is expected to take proactive steps so that people can easily lend their support for their success.

The decision by the minister to set up a fresh committee to draft a new version of an already existing Petroleum Industry Bill, PIB, is viewed as still a dance around the same wastage said to be partly responsible for the ‘subsidy’ that the nation still suffers from.

Many analysts note that

although government is continuous, even though its operators are transitory, it is logical that the Madueke went back into the archives to see how developments in the industry grew, right from when oil was discovered during the reign of Gen Yakubu Gowon.

This, they argued, will save the economy a large chunk of money instead of committing such scarce resource into paying for the sitting allowances and logistics of these committees and panels being set up.

Over the years, oil was developed as a nationalised resource and was planned in such a way that operations were carried out devoid of the kind of crisis that characterise them today, which became the albatross of the industry.

The petroleum sector grew to the level that it became the resources that provided 90 percent of the Nigerian foreign exchange earnings, according to General Tajudeen Olanrewaju’s Presidential Review Committee Report of 1995.

As situations arose, various panels were set up to review the them with a view to finding solutions for them, such as the management crisis of the Nigerian National Petroleum Corporation, NNPC, under the Major General Emmanuel Abisoye Panel of Enquiry, which sought to reform and reorganise the national oil company under the Late Gen Sani Abacha’s regime in 1994.

Abisoye report

Since the NNPC is currently facing a similar crisis, the minister is advised to dust up the Abisoye Report in dealing with the NNPC.

The Abisoye Report stated, “The best starting point for reviewing the structure and organisation of the NNPC must be the law that gave birth to the institution, to ascertain the nature, structure, organisation, functions and powers that the enabling law fashioned for the establishment and operations of the institution. In doing so, a short sketch of the historical background is necessary.”

Also, the General Olanrewaju Report recommended that the best way to move the NNPC forward was to return the corporation to what it was at inception as a national oil company in line with what obtains in other oil producing countries, which it said can be achieved through privatisation.

According to the report,

“The NNPC as a public sector undertaking has to move gradually into a commercial environment given our historical experience with other government agencies that have been partially let on their own. “Privatisation will remove completely State ownership and control in the business of exploration, exploitation and processing of crude oil and may consequently diminish same in the area of supply, distribution and pricing of petroleum products.

“The NNPC as it presently operates has been found to be reckless and indisciplined even under Government control. On a very careful consideration of all relevant issues, Government may decide to have the cooperation of the private sector in equity participation in downstream operations.”

The Report also recommended that “government should embark on contract leasing of the nation’s four refineries to private participants,” adding that a mechanism should also be put in place for the control of the conduct of the lease contractors in areas of fuel supply and distribution.

Analysts believe that the federal government can solve a lot of the crises in the downstream petroleum sector by implementing some of the recommendations of previous committees, and by so doing not only eliminate the subsidy burden, but also reduce the bridging costs being funded under the Petroleum Equalization Fund, PEF.