By Obas Esiedesa – Abuja

Experts and other stakeholders working in Nigeria’s petroleum industry has expressed optimism that reforms needed to grow the sector would happen following the passage of the Petroleum Industry Bill, PIB, by the National Assembly on Thursday.

The PIB which has been in the making for 20 years would replace the obsolete Petroleum Act of 1969.

In his reaction to the passage of PIB, energy expert, Mr Michael Faniran described it as a welcome development, saying everybody is happy with the National Assembly despite the length of time it took to get the Bill passed.

Faniran expressed optimism that the Bill when signed into law by President Muhammadu Buhari would create an efficient industry with independent governing bodies.

“For the Upstream and the Downstream, the governing bodies have clear aims and objectives. It is my hope that this will promote transparency that is not just one person who will be policy maker and regulator”.

He noted that the new law will also attract the needed investments as the direction which the government has decided to follow has become clear, “Now there is clarity. It is not whether it is good or not, it is now clear where the government is going.

“So anybody who wants to invest now knows where the government is going”.

For the oil host communities, he called for understanding, saying the PIB has established a good starting point. “If anyone is not satisfied with the provision, I think amendment can come later to accommodate new thinking.

“We cannot get everything right at the same time, we will keep correcting it. Today is a good day for the oil industry after many years,” he added.

In its reaction, the Centre for Transparency Advocacy, CTA, said the passage is good news for Nigeria and for the industry.

ALSO READ: PIB: NASS’s 3/5% equity share to host communities ‘ll trigger crisis — Ogbonna, Itsekiri stakeholder

CTA in a statement by its Executive Director, Faith Nwadishi congratulated Nigerians especially, the civil society, media, host communities and donor agencies that gave their supports leading to the achievement of “this result which is a positive step towards having a reform petroleum industry.”

Nwadishi explained that “generally, we are happy that sections, 83, 104 to 108 of the new Bill (the House of Representatives version) make provisions for contract transparency, disclosure, and outlaws gas flaring, provides five per cent operational cost for host communities, however, did not take recognizance of gender, host are still held responsible for any kind of sabotage to oil facilities.

“Section 83 sub 3-5 on contract transparency provides that ;3(a) the text of any existing contract, licence or lease and any amendment or side letter with NNPC shall – A) not be confidential.

“Section 104 of the Bill makes gas flaring an offence except in the case of emergency exemption granted by the Commission or for an acceptable safety practice. Offenders are liable to a fine and the fine will be used for investment in midstream gas infrastructure within the host community on which the penalties are levied.

“We noted that not a single word of gender was mentioned in the Bill, however, the word women were mentioned once in relation to host communities’ needs assessment”, she added.

CTA observed that the first hurdle has been crossed, we expect the leadership of both arms of the National Assembly to quickly harmonize their versions of the passed Bill and send same to the President for his assent.

“In the same manner, we charge the President to assent to the bill as soon as it comes to your desk in fulfillment of your electoral promise to Nigerians and your commitment to a better managed petroleum sector”.

Earlier the PIB was passed by the National Assembly with two regulators for the petroleum industry despite opposition from sections of the industry and experts.

A copy of the report Ad-Hoc Committee on PIB by the House of Representatives obtained by Vanguard showed that the provisions for the establishment of the Nigerian Upstream Regulatory Commission and the Nigerian Midstream and Downstream Petroleum Regulatory Authority were retained.

The Upstream Regulatory Commission will assume the upstream powers of the Department of Petroleum Resources, including the technical and commercial regulations of the upstream petroleum operations.

The Midstream and Downstream Regulatory Authority will assume also some of the powers of the DPR and all of the powers of the Petroleum Product Pricing Regulatory Agency, PPPRA.

The Authority shall have the power to regulate midstream and downstream petroleum operations, including technical, operational, and commercial activities.

ALSO READ: 10 things to know about Nigeria’s PIB

It shall also ensure efficient, safe, effective and sustainable infrastructural development of midstream and downstream petroleum operations; promote healthy, safe, efficient and effective conduct of midstream and downstream petroleum operations in an environmentally acceptable and sustainable manner.

Speaking on the proposals for the two regulators in Abuja, Professor Wumi Iledare said although the PIB as currently drafted is not a perfect Bill, it is important to have a good Bill than not have a Bill at all.

“This Bill is not perfect but it is good enough for us to start after 20 years of attempting. There are three important chapters and you all know about it.

“The Chapter on Governance is to help us solve this amorphous governance process that we have. Now that Bill is going to separate policy from regulations and from commercial.

“The only bone of contention that is still there is the reason why the PIB was not signed originally, which there are some who want two regulatory institutions and there are some of us who think that one regulatory agency is enough for what we have in Nigeria.

“Especially when things are evolving and innovation is important. The only caveat is the Ministry of Petroleum, I don’t think the technical capability is there to allow for continuity.”

He explained that the Ministry of Petroleum Resources must be reorganized to make sure that it separates technical from the administration.

“When it comes to the administration of leases, the idea is to move away from what I call discretionary awards. That must be avoided. Do not give room for discretionary awards because it does not give you the fair market value for scarce resources like petroleum,” he added.

Vanguard News Nigeria

Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.