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Senate passes PIB, after 10 years (Updated)

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Nearly a decade after late President Umaru Musa Yar’Adua led government conceived the idea, the Senate, on Thursday, passed the Petroleum Industry Bill (PIB).

According to details of the bill, a copy of which was obtained by Ripples Nigeria, it seeks to create efficient and effective governing institutions with clear and separate roles for the petroleum industry. According to the bill, it seeks to establish a framework for the creation of commercially oriented and profit driven petroleum entities that ensure value addition and internationalisation of the petroleum industry.

It also 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.

Lastly, the bill is seeking to promote transparency and accountability in the administration of petroleum resources of Nigeria and foster a conducive business environment for petroleum industry operations.

With the passage of the bill, which is tagged Petroleum Industry Governance Bill (PIGB), a new regulatory agency will be set up.

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The new commission which will be called Nigeria Petroleum Regulatory Commission (NPRC), will take over the functions of Petroleum Inspectorate (PI), the Department of Petroleum Resources (DPR) and the Petroleum Products Pricing Regulatory Agency (PPPRA).

‎According to the bill, more powers will be vested on the commission, rather than on the President or the Minister of Petroleum Resources.

The bill has significantly reduced the powers of the President and the Minister of Petroleum Resources in exercising control over the oil and gas sector.

According to the bill, the Minister of Petroleum Resources shall “be responsible for the determination, formulation and monitoring of government policy for the industry; exercise general supervision over the affairs and operations of the petroleum industry subject to the provisions of this Act; report developments in the petroleum industry to the Federal Executive Council; advise the government on all matters pertaining to the petroleum industry and promote the development of local content in the Nigerian petroleum industry.

“The Minister will also represent Nigeria at international organizations that are primarily concerned with the petroleum industry; negotiate and execute international petroleum treaties and agreements with other sovereign countries, international organizations and other similar bodies on behalf of the government, subject to the approval of the Senate.”

Lawmakers added in the new bill, that upon the recommendations of the new commission, the Minister can grant, amend, renew, extend or revoke any licence or lease required for petroleum or production pursuant to the provisions of the act or any other enactment.

The bill proposed that when the commission is created, it shall be vested with all assets, funds, resources and other movable and immovable properties which immediately before the commencement of operation of the new commission, were held by the PI, DPR and PPPRA.

The new commission, among other things, will also administer and enforce policies, laws and regulations relating to all aspects of petroleum operations which are assigned to it under the provisions of the Act.

In a similar vein, two new entities will be established by the new bill, when signed into law. The new companies, Nigeria Petroleum Assets Management Company and National Petroleum Company, will be vested with certain assets and liabilities of Nigeria National Petroleum Corporation (NNPC). The National Petroleum Company for instance, will operate as a full independent commercial entity.

In another move, in the PIGB, the Ministry of Petroleum Resources will be renamed Ministry of Petroleum Incorporated.

These bold moves, according to lawmakers, are geared towards unbundling the NNPC and the petroleum industry.

The Senate is expected to pass two more bills to further regulate the oil and gas sector. Already, the Host Communities’ Bill, has passed first reading in the Senate.

It is expected to be passed into law before the end of 2017. Similarly, the Senate will also commence moves to pass the another tranche of the bill which will deal with the Fiscal aspect of the oil and gas sector.

President of the Senate, Bukola Saraki, who presided, said with the passage of the bill, corrupt practices in the oil and gas sector, will be reduced. He added that inefficiency, currently associated with the sector, will also be done away with.

“The bill will stimulate the oil and gas industry. It will reduce the area of corruption and inefficiency in the oil and gas sector,” Saraki said, while commenting after the passage of the bill.

The House of Representatives, is also expected to concur before it will be transmitted to President Muhammadu Buhari for assent.
 

 

 

 

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