Tag: PIB

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REPORT ON THE FEDERAL HOUSE OF ASSEMBLY’S PETROLEUM INDUSTRY BILL SOUTH-WEST PUBLIC HEARING

The House of Representative’s Committee on the Petroleum Industry Bill (“PIB”) headed by the Chief Whip of the House, Hon. Ishaaka Bawa, held its South-West public hearing on Monday, 22 and Tuesday, 23 April, 2013 at Lagos Airport Hotel.

In attendance were various stakeholders in the petroleum extractive industry, petroleum industry consultants and experts as well as representatives from various government departments.

Although the Committee received a handful of remarks on the first day of hearing (particularly from the Lagos State Government), most representations were left till the hearing’s second day.

A representative from Shell expressed concern that PIB’s fiscal framework did not encourage new investments and if passed as drafted, the country stood the chance of experiencing a decline in deep water explorations.

Also contributing, Engr. Dada Thomas of Frontier Oil Ltd. and Mrs. Catherine Uju Ifejika of Britannia-U Nigeria Ltd. spoke on the Bill being unfavourable to Marginal Field Operators and dis-incentivising gas production. They advocated for better incentives for indigenous operators, a less stringent fiscal framework and an attractive pricing regime for operators involved in gas operations.

Speaking primarily on the Petroleum Host Community Fund, Environmental Rights Action’s Executive Director, Mr. Godwin Ojo, called for a redefinition of Petroleum Host Communities. He suggested the need to expand the category of communities classified as Host Communities. He suggested that Host Communities include all States affected by every aspect of petroleum operations and not just the Niger-Delta states.

Rounding up presentations, the Petroleum Technology Association of Nigeria (PETAN)’s PIB committee chairperson reiterated the general sentiments the Bill had received since its draft was released in July 2012.

Amongst other things, he expressed the need for the Bill to take more local content initiative, restrict the powers of the President as regards discretionary award of licences and leases, merge the regulatory agencies, allow greater transparency in NOC divestment and provide more tax incentives.

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PIB SENATE COMMITTEES TO REPORT TO THE SENATE IN 6 WEEKS

It has been reported (here and here) that the Petroleum Industry Bill (PIB) on Thursday, March 6, 2013, scaled through the Second Reading on the floor of the Senate and has been passed on to the Senate Committees on Petroleum (Upstream and Downstream), Gas and Judiciary, Human Rights and Legal Matters.

Senators Emmanuel Paulker (Bayelsa Central), Chairman Committee on Petroleum(Upstream); Magnus Abe (Rivers South/East), Chairman Committee on Petroleum(Downstream); Nkechi Justina Nwaogu (Abia Central), Chairman Gas Committee; and Umaru Dahiru (Sokoto South), Chairman Committee on Judiciary, Human Rights and Legal Matters are charged with collating the views of the Senate on the Bill together with those of the public, which would be received through public hearings, and report same to the House within six (6) weeks.

The Senate President, David Mark commended the accord shown by his colleagues in getting the Bill passed to the Committee Stage and expressed his delight that the Bill had enjoyed robust debate as no fewer than 81 Senators had made contributions on the Bill over the past 3 days.

Mark summarized the general issues the Senate had with the Bill as:

  1. The provision for a Petroleum      Host Community Fund;
  2. The insufficiency with regards      frontier exploration; and
  3. The excessive powers of the Minister      of Petroleum.

He also made note as to the impracticability of certain portions of the Bill such as the Bill exempting the Nigerian National Petroleum Corporation (NNPC) assets to be privatized from provisions of the Public Procurement Act.

Although he pointed out that the Bill was a “worthy Bill”, he also mentioned that no Bill had come through the Senate and not been tinkered with. He assured the House that subsequent to the public hearings, “amendments, additions and subtractions” will be made to the legislation.

 

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Alison-Madueke – Petroleum Industry Bill will boost output by attracting foreign investment

Nigeria’s Petroleum Minister, Mrs Diezani Alison-Madueke is reported by Bloomberg commending the potential benefits of the PIB for investment in the Nigerian oil and gas industry. According to Alison-Madueke, the PIB is designed to create “a fair balance between small and big operators in the same terrain.” The Minister’s comments are likely to refer to the provisions for Production Allowances in Schedule 5 of the PETROLEUM INDUSTRY BILL 2012, which give producers an allowance in accordance with their levels of production. As an example, under those provisions, small oil producers in onshore areas that produce less than 27,300 barrels of oil per day would be entitled to oil production allowances of the lower of US$ 30 per barrel or 30% of the official selling price.