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Tag: PIB

  • PIB: Nigeria mulls 40% sale of new state oil firm

    PIB: Nigeria mulls 40% sale of new state oil firm

    Nigeria plans to split  the Nigerian National Petroleum Corporation (NNPC) into two to help ease a planned stake sale of at least 40 per cent of a newly created National Petroleum Co (NPC) in coming years, according to a draft of a long-awaited oil bill seen by Reuters.

    The bill envisages the sale of at least 10 per cent of NPC over five years, and is targeting 40 per cent or more over 10 years. The transaction is expected to fix a cash shortage that is hampering investment at NNPC and end graft.

    The National Assembly is to start debating within days the amended Petroleum Industry Bill (PIB), in the works for a decade and designed to change everything from taxes to environmental rules and revenue sharing, as well as overhauling NNPC.

    Lawmakers have not previously been able to agree on the 200-page bill, but President Muhammadu Buhari has made its passing a priority as he seeks to overhaul the oil and gas sector, which accounts for 70 percent of state income.

    NNPC’s output has been stagnant at around two million barrels a day for years as the company struggles with graft, bureaucracy and funding problems.

    To accelerate the reform process, the nation is breaking up the bill, with the first part dealing with the reform of NNPC, a pet project of Buhari.

    “Divestment of shares … may include the sale or transfer of shares to institutional or strategic investors,” the draft said, without giving more details.

    A sale of at least a 10 per cent stake in the new firm is to take place within five years, with the rest to happen within 10 years, the bill says. The previous draft had called for a 30 per cent sale within six years.

    It gave no reason for the longer timeframe, but a source involved in the draft, said selling a larger stake was intended to raise more funds and help minimise the risk of corruption, because of the greater influence of outside investors and private firms.

    “Bidding is open to international investors,” the source said.

    Part of Nigeria’s output comes from joint ventures (JV) with foreign and local companies in which NNPC holds the majority stake. However, NNPC is always behind on covering its share of costs owing to the slow pace of government approvals, explaining the need for outside funding.

    The act that created NNPC decades ago contained legal grey areas which allowed mismanagement to go unchecked and billions of dollars in revenue to go seemingly unaccounted for.

    NPC will look after JVs mainly with oil majors, while the second company to be created from NNPC, dubbed NPAM, will manage all production-sharing contracýts and service agreements, a second source involved in drafting the bill said.

    The draft bill already lists 26 licences but the source said there would be many more.

    The second source involved in the drafting also said that the other bills which would be part of the overall reform of the energy sector have not yet been finalised.

  • Nigeria loses N3tr yearly to PIB absence, says group

    Nigeria loses N3tr yearly to PIB absence, says group

    The Civil Society Legislative Advocacy Centre (CISLAC) has urged the executive and legislature to make the passage of the Petroleum Industry Bill (PIB) a priority to stop the N3 trillion revenue yearly.

    In a statement by its Executive Director, Comrade Auwal Musa, the group said: “CISLAC recalls that the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, had said Nigeria is losing $15 billion (N3 trillion) annually due to non-passage of the Petroleum Industry Bill (PIB) into law.’’

    Auwal said the failure of the past legislature to take advantage of the constitution review to vote for financial autonomy put the legislature in difficult.

    This, he noted, has led to salary crisis in some Houses of Assembly.

    According to him, the refusal to  use that opportunity confirmed  that state assemblies are being  manipulated by the executive.

    Such control, Auwal said, made them incapable of making independent decisions in terms of law making, oversight and even representation.

    “The governor virtually appoints all the leaders at the state assembly; they see themselves as agents of the governor and not representatives of their people.

    “This attitude has undermined effective legislative processes because the state governor determines the kind of discussion on the floor and if any member acts differently he or she is sanctioned,” he said.

    While describing this as undemocratic, the CISLAC executive director said financial autonomy would have allowed members to freely carry out their legislative duties without going to beg and be afraid to take decisive action.

    “It was a lost opportunity for them to reposition how they work for effectiveness and also enable them to clearly mainstream their reasonable salary and allowance. If it (amendment) had been done, we would not be witnessing the kind of crisis going on in some states,” Auwal said.

  • Lawmaker calls for quick passage of PIB

    Lawmaker calls for quick passage of PIB

    A House of Representatives member, Mr Daniel Reyeneju, has urged his colleagues at the National Assembly to ensure quick passage of the Petroleum Industry Bill (PIB) in the current session.

    Reyeneju, who represents Warri South/Warri South-West constituency, made the call in an interview with the News Agency of Nigeria (NAN) on Wednesday in Abuja.

    He expressed concern over the long delay in the passage of the bill, said that bill, if passed, would address current fuel crisis in the country.

    “This is almost one year gone in this administration and by next year we will be politically jostling again.

    “And, the moment you go into political jostling in Nigeria, you lose some good time of parliamentary works, even that of the executive.

    “What I expected the 8th Assembly to have done is to bring the PIB again and go under order 12 on bills from preceding assembly and then pass it to the committee of the whole for hearing,” he said.

    Reyenieju decried that the delay of the PIB could be as a result of some forces who would not want it to be passed.

    “I got some information from the government, I mean, the executive that they are trying as much as possible to unbundle the PIB itself.

    “We have come a long way with the PIB; this is the 12th year of the PIB in the parliament and almost about 16 years of the PIB in Nigerian domain and public discourse.

    “I am yet to find out which of the renowned consultants in the nation’s petroleum industry that has not made one or two contributions to the PIB in the past.

    “In as much as we are waiting to see a striking difference from the consultants from the ministry, I want them to be quick about it so that we can see what they have put together.

    “What I am saying in essence is that we need the PIB in whatever form, whether it is going to be unbundled, we are waiting for it,” he said.

     

  • Senate, House to begin debate on PIB next week, says Saraki

    Senate, House to begin debate on PIB next week, says Saraki

    The Senate and the House of Representatives will commence debate on the Petroleum Industry Bill (PIB) by laying it in their respective chambers next week as a demonstration of the synergy existing between both chambers of the National Assembly.

    Senate President, Dr.  Bukola Saraki stated this in Abuja at a Business Environment Roundtable on the economy hosted by the National Assembly.

    He said this has become necessary to gain speed in the consideration and passage of the PIB and to prevent wasting of time, energy and scarce resources that was prevalent in the past.

    Saraki said: “We have said that the present National Assembly would not be business as usual. More importantly is the presence of the Honourable Speaker represented by the Chief Whip of the House at this event. The message from this is that the National Assembly – both Senate and House of Representatives, is working very closely together in the 8th National Assembly and as such, some of these processes would not be bogged down in any of the chambers.

    “We are both committed; we have both come out with our agenda and as part of this commitment, you will all see next week, when we lay the PIB. You will see that the Bill we are going to lay in the House is the same Bill we are going to lay in the Senate because for the first time, we are committed to work together as one to achieve results,” he said.

    On the purpose of the roundtable, he said: “Our dear President Muhammadu Buhari has laid down for us the vision for a diversified economy away from too much dependence on volatile oil, to ensure  security of our people’s lives, block revenue leakages, create employment for our people, expand our people’s economic opportunities and close the gap on our infrastructure deficit.

    “The National Assembly has in tandem made these the vision, the anchor-point of its legislative agenda but we know that being a mere agenda is not enough, that no mantra or talk can make this happen without commensurate purposeful action.”

    He lamented that the nation’s business environment is running largely on obsolete laws, weak governance framework and fragmented regulatory structures bogged down by inhibiting practices with very weak accountability mechanisms.

    He said the research that led to the business environment report was necessitated by the desire to create a new architecture for businesses to thrive in the country.

    He said the special business environment roundtable was meant to “interrogate the report, validate its conclusions, get the buy-in of key stakeholders including the organised private sector, key government agencies, policy makers, regulators, the media, civil society and other stakeholders.

    “We have gone this route because we believe that if we deliberately involve and continuously engage our people in lawmaking, the edicts and policies we make will be greatly enriched and accepted having been a product of collective consensus.”

  • Unbundling NNPC is not an option for PIB, says auditor

    Unbundling NNPC is not an option for PIB, says auditor

    Splitting the Nigerian National Petroleum Corporation (NNPC) into several companies may not address the problem of lack of clarity in the fiscal terms,  Oil and Gas Auditor, John Adidi, has said

    Adidi, who spoke to The Nation on telephone, said when the laws guiding the industry, including the fiscal regime for the Joint Ventures (JV) and the Production Sharing Contracts (PSCs), were not made clear, it would not bring foreign investors back, adding it should rather be a reform.

    He said: “What the government should have done is to take a general look at the petroleum industry bill (PIB) and represent it either in bits so that whatever law that is made would be current.”

    The Petroleum Industry Bill (PIB), when passed into an Act, becomes the master reference law that governs the petroleum industry – from the upstream division (exploratory, development and production activities) through the midstream (gas processing) to downstream (servicing, refining, distribution, transportation,marketing/retailing)

    He said though crude oil price was falling globally, nevertheless oil is still the number one revenue earner for the country.

    He said the country needed to have a framework because anybody investing in the oil and gas is investing for the long term because it is capital intensive.

    “There is no way an investor would put money when he doesn’t know what the laws are, especially when the fiscal regime is not clear. No wise investor can put his money in the Nigerian oil and gas sector,” he added.

    While in support of the government policy to make the NNPC better run as a national oil company, Adidi maintained that it should be part of a larger reform. “NNPC still remains too complex so you need to have it broken down. It is too complex and big, that is why it is difficult to be handled by one person,” he said.

    Adidi said for now, there is no PIB. According to him, the last PIB was the 2012 version, which got to a certain level before the seventh assembly wound up

    He argued that the PIB not being passed into law meant that industry still operates the law that has expired in the country. He said the PIB was supposed to be reintroduced to the National Assembly by the executive because it is an executive bill.  According to him, the House of Representatives had indicated that they have been waiting for that bill to be reintroduced and the executive appears not too keen to do that, rather they wanted to use the extant legislation to do whatever policy review and reform they want to do.

    “One would have expected that the present executive looks at that PIB again and remove what they don’t want and represent it to the National Assembly because the bill has to go through the whole process again, first reading, second reading, committee stage and the third reading,” he said.

    Adidi said there is no clarity in the law guiding the industry. “We are in a depressed economy and the revenue due to the government is falling drastically. There is need for the government to have a think-tank that will look and carry out various economic researches, looking at how best to diversify the economy away from oil and then ensure that the revenue was increased to run the social programmes that the government has embarked upon,” he said.

  • Minister urges speedy passage of PIB

    Minister urges speedy passage of PIB

    The Minister of Niger Delta Affairs, Pastor Usani Uguru Usani, has urged the National Assembly (NASS) to speed up the passage of the Petroleum Industry Bill (PIB).

    The call is contained in a statement issued in Abuja on Friday by the Director of Information in the ministry, Mr Salisu Na’inna.

    Na’inna said that the minister made the call during a meeting with executives of the Host Communities of Nigeria Producing Oil and Gas (HOSTCOM).

    He added that the early passage of the Bill would address the plights of oil and gas producing communities in the country.

    He noted that “I am concerned about the PIB because its passage has dragged for too long.”

    He reiterated Federal Government’s commitment to address the plight of the people of the region, stressing that no stone would be left unturned toward
    ameliorating their sufferings.

    On gas flaring, he said “those who suffer the effects of gas flaring are not only within the Niger Delta region even though the people of the region feel
    the impact most.’’

    He said that the Federal Government was consulting on the clean-up of the area with relevant authorities.

    He urged the communities to support government in checking oil theft and vandalism of oil and gas installations, which he said should be done with probity and sincerity.

    The National Chairman of HOSTCOM, Chief Alfred Bubor, decried the slow pace of development in the region.

    He added that successive governments had failed to significantly change the lives of the people or the quality of their environment.

    Bubor said that the oil and gas producing communities had never felt the impact of the several interventions initiated by government.

    The Permanent Secretary in the Ministry of Niger Delta Affairs, Wakama Belema, then assured the oil and gas producing communities of the present administration’s commitment to their welfare.

    She said that the ministry was making efforts to ensure that the communities felt the presence of government in their lives.

    She listed some of the various projects and programmes of the ministry in the region to include the construction of skill acquisition centres, housing schemes, electrification of communities, road and water supply projects.

    All these projects were being implemented to ameliorate the sufferings of the people of the Niger Delta, she added.

  • National Assembly lacks will to pass PIB, says lawyer

    A lawyer  has blamed the non-passage of Petroleum Industry Bill (PIB) on lack of political will by the National Assembly and the Federal Executive Council (FEC).

    Mr Taiwo Ogunleye said the non-passage of the bill has caused a  problem for the oil and gas industry, and  the economy.

    He said transparency issue was a major challenge in the industry, and noted that restructuring of the sector could be efficiently carried out without amendment or repeal of the law as the case may be.

    He said: “We have transparency and accountability issue. We have low investment in the sector because people are not sure what the fiscals would be in order to be able to plan on it. The situation is like the petroleum industry is in a state of uncertainty because nobody wants to invest without certainty.”

    Ogunleye, who spoke with The Nation in Lagos, said having sent the bill to the National Assembly, it is the responsibility of the government to follow up on it. Similarly, if the legislative arm has a problem with the bill, it also has the responsibility to get back to the executive

    “First of all, there was a delay because it took them (legislators) long period to even give consideration to begin deliberation on passage of the bill. If a bill had been sent to the lawmakers as at 2012, and they began to consider the passage in 2015, there is a question of whether they actually had the intention or will to do so,” he said.

    He blamed the National Assembly for identifying the provisions in the bill that were adequate and refused to approve them for passage into law.  He said the lawmakers could have reduced the bill to the size that can be passed, while work on the contentious ones continues.

    The executive arm of the government is also supposed to follow up on the bill to know what has delayed the passage.

    Ogunleye said the 2012 PIB was very adequate when compared to that of 2008. According to him, in 2008 two things were not satisfactory, the provisions on the upstream, which he said was not different from the existing legislation.

    In addition, provisions on fiscals were also nothing different from what was in place now. He said political will was fundamental and crucial for the current National Assembly to pass the bill into law. He advised the Federal Government to see the passage of the bill as a serious business and take steps towards ensuring that the bill is passed.

  • New PIB threatens million jobs in oil sector

    New PIB threatens million jobs in oil sector

    The implementation of the new ‘Petroleum Industry Governance and Institutional Framework Bill 2015’ if fully operational may not bode well for stakeholders in the nation’s oil and gas sub-sector, The Nation has learnt.

    Giving insight on the new draft of the PIB, Oluwaseyi Gambo, the immediate past National Public Relations Officer of Petroleum and Natural Gas Senior Staff Association (PENGASSAN) said it was disheartening to note that the new bill was already having a rippled effect on the industry.

    Speaking on the estimated number of jobs at risk if the new draft PIB is implemented, Gambo said: “As we speak, all sectors in the Nigeria oil and gas industry have lost between 18-20 ýpercent of her work force. Many more workers would still be lost if the government and unions do not move fast to nip the current inferno in the bud.”

    The nation’s oil and gas industry, the former PENGASSAN image maker observed, has been haemorrhaging for the past three years due to prevarication and lack of political will by the immediate past President Goodluck Jonathan government in collaboration with the National Assemble to handle some pressing issues in the industry like crude theft and vandalism. “No single persecution for oil theft, all the about three different probes on subsidy scam nobody sanctioned.”

    Expatiating, he said: “There was a time Shell’s operation in western Nigeria was not making a dime for two solid years due to the pipeline vandalism menace and Shell was ýpaying workers salaries, giving promotion etc. So when Shell management decided to downside the union had nothing to say, but take the bitter pill. Brilliant young men and women who still have a lot to give in service to Nigeria and the industry have been sent home. Chevron has gone this route, Addax is threatening, Sapetrol have almost windup, and almost all the contract workers in Total E&P are gone!”

    Going down memory lane, he recalled that: “This was not what former President Olusegun Obasanjo envisaged when the OGIC committee was instituted which gave birth to PIB. In fact if successive presidents have continued in the Obasanjo spirit, the industry won’t be in the mess we have found ourselves today, and Nigeria would have been better for it.”

    Post PIB in the oil and gas industry, he stressed, would have been positioned to be more competitive. “The environment now is so dynamic and volatile that we are not even talking of competing with what the price of crude is saying in the international market, the unexpected export drive of the United States, Saudi Arabia trying to strangulate the financial muscle of ISIS etc, what we have now is a case of survive.”

    Gambo who is the Founder and Convener, The Good Governance Group, said: “If the Bill had been passed years ago as some of us warned repeatedly, the industry would have passed the teething stage now, then what was being made put to good use. I wonder what the former Senate president who was characteristically boasting then that the IOC’s can’t dictate to Nigeria how much she will sell her oil will say now. It was never the issue of IOC’s but what Nigeria wants. A bill as important as PIB in the National Assemble for close to nine years and you think the whole world will be waiting for us?”

    The one-time member of the Petroleum Equalization Fund (Management) Board, who lamented that the nation was suffering from the mistakes of bad leadership, said most of the countries have used what they got from oil to strengthen other sectors they had comparative advantages.

    Raising a poser, Gambo said: “Did the United Emirate wait for the crash of crude oil? Today we are at the mercy of others. We can’t even refine for ourselves, we are a pathetic case, laughing stock of the international community. We paid lip service to the development of other facet of the economy for too long. We are a nation only good at wasting resources. We are yet to know what IBB did with the Gulf windfall. We should go back to the basics, look at the laws we have that are hampering economic initiatives, reduce corruption, have more competent hands in strategic positions of the economy to drive the process.”

    The PIB, a framework for the management of the petroleum sector has been hotly debated since the idea was mooted in 2000 with successive members of the upper and lower legislative chambers unable to pass the bill into law.

    But some of the changes reportedly made to the new Bill include amongst others, curtailment of Ministerial powers, the splitting of NNPC into two separate entities: the Nigeria Petroleum Assets Management Co (NPAM) and a National Oil Company (NOC).

    The NOC will be an “integrated oil and gas company operating as a fully commercial entity” and will run like a private company. It will keep its revenues, deduct costs directly and pay dividends to the government thus putting an end to the era of waiting for Federal allocation for funding and always failing to meet cash call obligations.

  • PENGASSAN flays PIB

    PENGASSAN flays PIB

    The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has condemned the proposed Petroleum Industry Bill (PIB), describing it as anti-labour.

    The workers vowed to resist the plan by the Federal Government to retrench workers, especially employees of the Nigerian National Petroleum Corporation (NNPC) as a result of the restructuring in the proposed PIB.

    They argued that the planned sack was not in tandem with the “change” that the government promised Nigerians, especially in the area of job creation.

    Reacting to the official release of the proposed draft institutional and legal frameworks for reforms in the oil and gas industry by the Minister of State for Petroleum Resources, who is also Group Managing Director (GMD) of the NNPC, the group’s acting General Secretary, Comrade Lumumba Okugbawa, in a statement said the provisions in the proposed PIB are not only anti-labour but also not in the national interest.

  • Oil workers reject PIB

    Oil workers reject PIB

    Oil workers in the industry’s three regulatory agencies have rejected the redrafted Petroleum Industry Bill (PIB) soon to be presented to the National Assembly.

    The PIB is to replace the one passed by the Seventh Assembly but which was not assented by the president.

    Minister of State for Petroleum Resources Dr. Ibe Kachikwu had announced plans by the government to send another draft of the bill for the lawmakers’ consideration. The old bill, he said could not meet the yearnings of value-addition to the oil industry. But the content has not been made public.

    But yesterday, workers in the Department of Petroleum Resources (DPR), Petroleum Products Pricing Regulatory Agency (PPPRA) and Petroleum Equalisation Fund (PEF), said they would not accept the draft bill because it neglects their welfare.

    The workers said: “Petroleum Industry Governance & Institutional Framework Bill 2015”, if allowed to be passed into law, the bill, will lead to job cuts in some of the regulatory agencies. The bill seeks to provide the governance and institutional framework for the petroleum industry and other related matters.

    The workers operating under the auspices of Regulators Forum have petitioned the national leadership of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) not to allow the bill scale through without taking care of the anomalies contained in it.

    The petition signed by PENGASSAN Chairman, PPPRA Chapter, Victor Ononokpono, along with his DPR counterpart, Garba Bello, and PEF, Aminu Ahmed, said the concerns of the workers bordered on observations that the redraft institutional and legal framework for reforms in the oil and gas industry may have inadvertently left the oil workers in the cold.

    While commending the Minister’s effort to stimulate reforms in the industry after several failed attempts, they argued that some inconsistencies in the draft PIB had stirred some fears about a veiled attempt by the government to sack its members.

    They drew attention to some of the inconsistencies, especially in Part 3 of the redraft PIB which seeks to establish the Nigeria Petroleum Regulatory Commission (NPRC), Section 13, on the composition of its Board, and Section 87, on the Transfer of staff.

    They noted that the Bill provides that the Commission would combine the monitoring and regulatory roles and responsibilities of DPR and PPPRA to “administer and enforce policies, laws and regulations relating to all aspects of petroleum operations.”

    They expressed concern about the silence of the redraft Bill on the fate of the Petroleum Equalisation Fund (PEF) vested with the responsibility of ensuring uniform pricing of petroleum products, adding that “the union senses a subtle ploy to retrench or drop some of the work force transiting to the Nigeria Petroleum Regulatory Commission with the contentious clause on ‘transfer of certain employees.

    “Cessation of employment and transfer of staff should be automatic and guaranteed as provided by the Public Service rules and Constitution of the Federal Republic of Nigeria.”

    According to the workers, unlike the former PIB, the redraft bill does not make provision for the representation of the organised labour on the board of the Nigeria Petroleum Regulatory Commission (NPRC).

    To the workers, the redraft bill is a departure from the provisions of the original draft 2012 Bill. Part D, Section 47 (2) (f) and (g) on the Board of the Downstream Petroleum Regulatory Agency (DPRA), representatives of the two major oil workers unions, the National Union of Petroleum and Natural Gas Workers (NUPENG) and PENGASSAN were listed as members.

    “Apart from the uncertainty of the agency’s institutional role, the draft Bill as currently drafted will create job loss, as no provision for absorption or transfer of service for the work force is contemplated,” the oil workers’ representatives said.

    “The Central Working Committee must make a public position known on the non-inclusion of organised labour in the composition of the governing Boards of Commission against international best practice.”

    They asked the national unions to extract a memorandum of understanding on the re-drafting of the contentious issues, particularly as it concerned job loss of PENGASSAN members across the existing agencies (PEF, PPPRA and DPR).