The passage of the country’s Petroleum Industry Bill (PIB) has proved to be a real nightmare for successive administrations since the need for the bill was first mooted by the Olusegun Obasanjo administration (1999-2007).
The PIB, originally an omnibus law, is meant to regulate the entire sphere of the industry and repeal all current existing oil and gas legislations. It was also meant to overhaul the petroleum industry, entrench efficiency and transparency in both upstream and downstream sectors and bring operations in line with international standards.
Till date, the passage of the bill, which would have paved the way for massive investment in the country’s oil and gas sector has remained bottled up in the National Assembly with successive leadership of the legislature making efforts, with the accompanying horse-trading, to attempt a passage of the bill. Hence, the PIB, which seeks to increase government revenue from oil and lay down a strengthened legal and regulatory framework for the Nigerian oil industry, has suffered legislative delays and limited consideration from the executive. Curiously, even when some Assembly sessions passed the bill, the office of the President had been variously arm-twisted to withhold assent. So, the PIB remains the oldest bill in the National Assembly since 1999 when we regained democratic governance.
The best and latest effort made so far in the passage of the bill has been that of the 8th National Assembly, under the leadership of Senator Bukola Saraki and Honourable Yakubu Dogara which, in the quest to make the passage easier and less contentious, broke it down into four different components, namely; the Petroleum Industry Governance Bill (PIGB), the Petroleum Industry Administration Bill (PIAB), the Petroleum Industry Fiscal Bill (PIFB) and the Petroleum Host and Impacted Communities Bill (PHICB).
Unfortunately, only the PIGB was passed by the Nigerian Senate in May 2017, and the House of Representatives in January 2018, but was subsequently rejected by the President. The Petroleum Industry Governance Bill (PIGB) originally seeks to establish a framework for the creation of commercially, oriented and profit-driven petroleum entities, to ensure value addition and internationalisation of the petroleum industry, through the creation of efficient and effective governing institutions with clear and separate roles for the petroleum industry. It is meant to make the oil and gas sector more transparent and commercially viable as well as combine the functions of revenue generation and environmental protection in a single agency. However, the new posture of the Buhari administration in his second term seems to be a total reworking of the bill to take a total departure from the work of the 8th National Assembly. The new PIB will have two regulators, one for the upstream and the other for the midstream and downstream sectors of the industry.
While the government is supposedly working on the presentation of the new PIB to the National Assembly, the statement by the Minister of State for Petroleum Resources, Mr. Timipre Sylva, that the bid rounds for oil blocks stand suspended until the PIB is passed calls for some concern. An average oil and gas industry watcher will wonder for how long this development will persist given that the marginal oil fields are a substantial component of the country’s oil production and will add to the tempo of activities as well as job creation in the sector. If this curious suspension of the oil blocks bid rounds is to be sustained, then it behoves the government to leverage the current good relationship between the executive and the legislature to enhance the quick passage of the PIB, as one of the major achievements of this administration.
The Nigerian economy needs to be revived from its current state of sluggish growth. It can be recalled that it was the developments in the oil and gas sector that actually took the economy out of recession after five quarters of negative growth in the gross domestic product. Any setback in the tempo of activities in the sector will definitely have a dampening effect on the economy. The economy cannot afford to toy with this truncation of activities in the sector, particularly at this time when the growth prospects of the economy have been downgraded by the International Monetary Fund, IMF in its latest economic outlook projections for the country. A sense of urgency is thus needed to ensure that the issue of the passage of the PIB is finally laid to rest so that normal production in conformity with global best practice takes place in the country’s oil and gas sector, still the mainstay of the country’s economy.
The presidency should note that this newspaper is aware that the powers that have for long kept Nigeria’s growth down in the oil and gas sector including the very influential international oil companies (OICs) have a colossal war chest to lobby Nigeria’s leadership into stupor on this PIB. That is why the Buhari administration should not fall into constant executive temptation by the international lobby again. It is in the interest of the administration to ensure that the PIB jinx is broken this time under the Buhari administration. Let it be written tomorrow that the Buhari administration indeed took Nigeria into the 21stcentury oil-and-gas industry. Let it be added too that at the end of the day, the Buhari administration led Nigeria into a situation where we will plan development that will make the country to look beyond oil as expected now in a global context.