Saturday, 10 February 2018

HOW WILL THE PETROLEUM INDUSTRY GOVERNANCE BILL BENEFIT ORDINARY NIGERIANS?

The passage the other day of the long awaited Petroleum Industry Governance Bill (PIGB) by the House of Representatives brings to an end years of delays and needless horse-trading over the bill that was originally designed to revolutionise the petroleum industry into a more prosperous sub-sector for the benefit of Nigeria.

The Senate had earlier passed the bill in May 2017, pending when the House of Representatives would do the same before it would be presented to the president for signing into law. Signing of the PIGB into law, though a token compared to what the section needs, is one good thing for the oil and gas subsector that has been mismanaged for decades. The behemoth called the Nigerian National Petroleum Corporation (NNPC) needs to be reorganised for effectiveness and accountability. President Muhammadu Buhari should therefore accent to the bill as soon as it is presented to him.

The National Assembly should, however, expedite action on the other aspects of the petroleum industry bill, for example, the Host Community Bill, that was extracted from the original PIB.

That original PIB was tinkered with to satisfy sectional and other interests. Otherwise, the fundamental objective was to “Vest oil and gas resources in the sovereign state of Nigeria” which was expected to change the existing order, whereby foreign interests dominate Nigeria’s oil industry while Nigerians are sidelined.

The passed PIGB therefore is only a part of that original bill and its sole aim is to unbundle the NNPC. In essence, this PIGB effectively removes the issue of sovereignty of Nigeria over her oil resources from the reforms being originally sought while focus is largely on NNPC governance and corruption issues. In reality, therefore, little has really changed but it is better than nothing.

The House first passed the PIGB some 15 years after the original PIB was drafted and presented to the National Assembly. The House’s ad-hoc Committee on Petroleum Industry Bills made the recommendation which was adopted by the House at the plenary.

The PIGB provides for the establishment of Federal Ministry of Petroleum Incorporated, Nigerian Petroleum Regulatory Commission (NPRC), Nigerian Petroleum Assets Management Company and National Petroleum Equalisation Fund.

With the passage of the bill, NPRC would take over the functions of Petroleum Inspectorate (PI), the Department of Petroleum Resources (DPR) and the Petroleum Products Pricing Regulatory Agency (PPPRA).

Deputy Chairman, Ad-hoc Committee on Petroleum Industry Bills, Victor Nwokolo (PDP, Delta), who led the debate on the report, explained that some subsidiaries of the NNPC had also been merged into an entity to be known as the Nigerian Petroleum Regulatory Commission (NPRC). He said the House Committee adopted the Senate’s version of the bill.

It would be recalled that the PIB was first presented to the National Assembly in 2003 under the Olusegun Obasanjo administration for passage. The first legislative assembly, under Obasanjo, actually passed the bill but President Obasanjo refused to sign it into law. Nigerians expected a prompt passage when it was first introduced but were disappointed by the refusal of the president for whatever reason.

The bill was re-presented under the Umaru Yar’Adua administration, and ever since then has lingered. Four legislative assemblies sat over it to no avail. It was disheartening that at a point, the Federal Government renamed the PIB as Petroleum Reform Bill (PRB), which seemed to foreclose the prospect of having the bill passed in its original design.

The re-awakened interest in the bill under the Buhari administration was a welcome development. While it is heartening that the two houses of the National Assembly finally passed the PIGB, it needs to be acknowledged that, perhaps, no other piece of legislation has been so politicised, which is why the bill was delayed and tinkered with. Even now nobody should rejoice.

From experience, the unbundling of the Power Holding Company of Nigeria (PHCN) did not make the organisation to be more efficient. What is the guarantee that the same problems won’t arise in the case of the NNPC?

One problem that plagues the NNPC is its opaqueness. To what extent is it guaranteed under the new structure that the NNPC would henceforth be transparent and accountable? Finally, how would the new bill benefit ordinary Nigerians?

More importantly, granted that the bill has been passed it is in no way a substitute for fiscal federalism. Not until the country is restructured along the lines of true federalism that gives component units of the country power to fully exploit resources in their domain would there be peace, progress and harmony. (Punch)

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