(By Mathew Dadiya)
“For instance, it provides that no project can be approved without a comprehensive “Nigerian Content Plan” which must include obligations on the part of the investor to purchase local goods and services, increase employment, as well as focus on training, education research and development. It also requires the foreign investors to follow guidelines in order to assist local companies. Adherence to the provisions of the bill will surely boost the purchase of local goods and services leading to higher employment opportunities for Nigerians.“
THE Petroleum Industry Bill (PIB) which was conceived almost a decade ago by the former President Olusegun Obasanjo when he set up an Oil and Gas Reform Implementation Committee to assess modality for the reformation of the oil industry; was meant to carry out a comprehensive reform of the oil industry with a view to bringing the Nigerian system under the international best practices and to replace the unfathomable secrecy of our oil industry with transparency, is seeing as a mirage and has been weighed down with a myriad of problems.
The bill which is currently before the National Assembly (NASS) is meant to change everything from fiscal terms to overhauling the Nigerian National Petroleum Corporation (NNPC), promote Nigerian content and significantly increase domestic gas supplies, especially for power generation and industrial development; with the ultimate aim of refining the Petroleum laws, after more than 50 years of oil and gas operations in Nigeria.
In as much as issues are being raised on the credibility of the certain parts of the bill, it is also important to note that if the bill is passed, all facets of the petroleum industry would be liberated from all government constraints and hurdles which hitherto rock the industry making it unattractive to good investors.
The National Assembly should for national interest, if nothing else, put their grievances aside, collaborate with the NNPC and other stakeholders to leveled the perceived contours in the PIB that have been generating controversies.
The leadership of the National Assembly in the persons of Senator David Mark and Speaker Aminu Tambuwal are rare gems, patriotic citizens and men of credible characters whose antecedents are unequalled and immeasurable. With the committees recently setup by the leadership of the Assembly to look into the cause of the delay in the passage of the PIB and fast track the process of passing it into law, it is believed that Nigerians would soon have the bill they have long anticipated.
No doubt, what appears to be holding the density of the argument and delay in the non-passage of the PIB should be the purport 10 per cent Community Equity which mandates every oil company to pay 10 per cent of its holding in any PML to the fund established for host communities addition to the 13 per cent currently enjoyed by the oil producing states. However, predictably this did not go well with some people who already felt marginalised in the revenue allocation.
The imperative of passing the bill into law cannot be over emphasised, considering the fact that the PIB gives incentives to both small and big players in the industry through transparent and fair rules of participation, good corporate governance and strong fiscal framework that will move Nigeria clearly towards the international best practices in the sector.
Of course, it is good to redress the dark sides but we should also understand that, the bill has far-reaching provisions on the issues of Nigerian content, which should not be impeded. For instance, it provides that no project can be approved without a comprehensive “Nigerian Content Plan” which must include obligations on the part of the investor to purchase local goods and services, increase employment, as well as focus on training, education research and development. It also requires the foreign investors to follow guidelines in order to assist local companies. Adherence to the provisions of the bill will surely boost the purchase of local goods and services leading to higher employment opportunities for Nigerians.
It is worth noting that the bill has in it, a series of landmark provisions to correct the anomalies of the current petroleum regime. For example, it is an indisputable fact that the Deep Sea Water Blocks contract that Nigeria entered into in 1993 with foreign investors is one of the worst contracts any oil-exporting nation can enter into as it seems to foster unilateral advantages only on the foreign partners with Nigeria having very little or no gains under the production sharing formula in the agreement. The royalties accruable to the country are zero per cent! The foreign partners take I00 per cent of the products. Even the taxes system under the said “bad deal” contract does not provide much benefit for the country as the tax regime included generous tax credits to these foreign investors which wiped out a great percentage of the collectible tax by the Federal Government.
I think the National Assembly should not only relent on redressing the 10 per cent community equity but also look at this issue very critically and possibly insert a clause that can bring about enforcing the redress of such dreadful contract for the good of our economy.
It is our utmost belief that the National Assembly will give the bill the needed attention it deserves by passing it into a law considering the benefits Nigerians stand to derive from it.
The general belief is that a regime of openness and transparency would be ushered in. Neither the NNPC nor the National Assembly is gaining from the prolonged delay in the passage of this all-important bill linked to underground manipulation of vested interests. Whatever maybe the situation, Nigerians are appealing to the lawmakers saddled with the responsibility of passing the bill into law to expedite action and save Nigeria.
• Dadiya wrote from Wuse 2, Abuja.
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