As the fate of the Petroleum Industry Bill (PIB) remained uncertain, stakeholders in the country’s oil and gas sector, have described the delay as an embarrassment to the country.
They believed that if Ghana, which took clue from Nigeria’s PIB to develop its petroleum law could pass the bill in record time, Nigeria should have no reason to delay the signing of the bill till date.
Ghana’s lawmakers passed the country’s PIB into law last year, to replace its Petroleum (Exploration and Production) Act, 1984.Though, the Minister of State for Petroleum Resources, Ibe Kachikwu, assured stakeholders that the bill would soon be passed into law, the PIB has not scaled past the second reading for more than a decade.
Speaking on the implication of the delay on investment, President, Oil and Gas Trainers Association of Nigeria (OGTAN), Dr. Afe Mayowa, in an interview with The Guardian, said that the continued delay in the passage of the PIB, has become an embarrassment to Nigeria, and poses a lot of credibility problem for the government.
Mayowa said government should emulate Ghana, which used Nigeria’s PIB template to develop its petroleum law and had since passed the bill into law.He said that it is no longer business as usual in the oil and gas industry as investors have become skeptical about the country’s petroleum laws and waiting for the passage of the bill to determine where to put their money.
“Nigeria needs a bill that will give clarity to the operators in the sector. We have been in the oil and gas business for 50 years and we do not have clear rules for investment and that is why many other countries are fast ahead of us. Ghana is only 10 years in the oil and gas business and they have clearly defined rules already. There are lots of uncertainty here and this is scaring away investors.”
Managing Director of Oilserve, Emeka Okwuosa, said that without the passage of PIB, Nigeria oil and gas industry would remain stagnant. He stated: “Our distinguished Senators say they will pass it very soon. I’m not a politician but a businessman. My take is that this is the fifth year we have been assured that that PIB will be passed soon.”
Okwuosa called on the Federal Government to ensure the passage of the bill to enhance investment in the country’s oil and gas sector.“But so far that we have not passed the PIB, there have been deferred investment and Nigeria will continue to lose values because some of the tax regimes, especially for offshore production are no more representative.
“If you hear we are producing one billion barrels offshore today, Nigeria is making little or no money from it. Because that was the regime that was set up in the 1970s to encourage offshore production and we have since gone from there to a stage where we should be getting something but we cannot get something because most of the laws governing the PSCs are outdated,” he added.
President, Nigerian Association of Petroleum Explorationists (NAPE), Abiodun Adesanya, attributed the delay in the passage of the bill to political interest.
Adesanya stated: “I had a discussion with some of the staff of Honorable Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, to understand what is the strategy going forward.
“So, what they told me which is what is being implemented now was that the PIB is going to be split into three major parts and the first part will be the one that will focus on regulatory activities and expansion. So those ones that are not political, if you remember, the PIB was going through a smooth conversation until they got into political areas and things got to a halt.
“So, they said let’s take out the political issues and focus on regulatory aspect and that’s what they have been doing. Now, we haven’t really interacted with this new National Assembly, we were invited in December 2015 when they were having a retreat and at that meeting, we did mentioned to them our intention in further engaging with them.
“They haven’t formed the committees at that time, but now that the committees are in place, we need to quickly reach out to them.”Kachikwu had said that extensive work collaborative work being done by the Ministry of Petroleum Resources with the National Assembly on the PIB. This bill, he stated, would be followed by the bill on fiscal terms.
He further allayed fears on the cooperation between the Executive and Legislature in ensuring the passage of the bill by affirming that the Ministry and Agencies have been collaborating with the National Assembly on the PIGB to ensure its passage in record time.