House of Reps Public Hearing – A Few Takeaways

It has been just over a week since the Public Hearing at the House of Representatives. Enough time to have mulled over some of the issues raised by investors, the Federal Government & the public on the Petroleum Industry Administration Bill, the Petroleum Industry Fiscal Bill & the Petroleum Host & Impacted Communities Bill. Here are 5 takeaways from the hearings. Continue reading “House of Reps Public Hearing – A Few Takeaways”

Light-hearted analysis of the Petroleum Industry Fiscal Bill

Dr Ekpen Omonbude of Bargate Advisory recently published this light-hearted but weighty analysis of the PIFB. In it, Dr Omonbude highlights 5 key issues in the Bill and the potential impact on investors and the Nigerian government. As a former advisor in the Commonwealth providing advice to countries seeking to set up or reform their natural resources fiscal policies, he is in a good position to examine the government and investor perspectives on the terms of the Bill.

This week on

Please find below a list of some of the issues we’ll be covering this week on

  • On Monday we will bring you a light-hearted review of the Petroleum Industry Fiscal Bill (PIFB) by Dr. Ekpen Omonbude, formerly of the Commonwealth, now of Bargate Advisory. Dr. Omonbude has advised a number of countries in the Commonwealth on their natural resources fiscal framework and in his usual style, makes the provisions of the PIFB accessible to readers;
  • We will also be highlighting key takeaways from the public hearing at the House of Representatives;
  • Further analysis of key terms of the PIAB will also be provided over the course of the week.

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House of Reps Public Hearing Day 2 – Dangote Industries Limited

  • PIAB
    • concerns about the third-party access – will not encourage investment
    • price control provisions are worrisome
    • specific protection to be given to facilities in the midstream sector
    • entities operating in the Free Trade Zone not covered by these provisions
  • PIFB
    • attempt to reduce allowable expenditure – provisions of the PIFB should be aligned with CITA
    • companies should be able to appeal Federal High Court decisions
    • re-consider the basis for penalising failure to self assess
    • withholding tax penalties should be aligned with CITA
    • harmonise potential conflicts in definitions of midstream and downstream


House of Reps Public Hearing Day 2 – Eket community

  • NDDC should be downsized financially, restructured and given specific areas of intervention
  • Monies reduced from NDDC should be given to the host communities
  • remuneration to host communities should be according to specific criteria that take into account the levels of degradation suffered by the communities
  • every host community should be allotted a marginal field

House of Reps Public Hearing Day 2 – Ministry of Petroleum Resources

  • PIFB
    • The PIFB does not tackle profit based erosion and profit sharing
    • The PIFB does not have a robust midstream fiscal system
    • Propose a clear link between product price and crude oil price
    • Consequential financial impact of increasing the tenor of the licences
    • There should be greater conformance with the government’s fiscal policy
  •  PHICB
    • Do not create additional burdens to operators
    • State governments should be involved in funding the community trust
    • Overwhelming burden should be on the part of the government
  • PIAB
    • Generally welcome the concept of a bill which deals specifically with
    • Ability of the Minister to supervise the Ministry is denuded by the bill
    • Who will regulate the regulator?
    • Minister should be involved in the licensing processes
    • For checks and balances the minister should determine when
    • Minister should have the power of approval
    • Acreage should revert to the state
    • Data ownership should reside with the state
    • Review the provisions regarding back-in rights
    • Grant of flared gas dree of costs should be retained by the government
    • Grant of ownership in petroleum should be explicitly stated
    • Grandfather the provisions of Petroleum Production and Distribution (Anti – Sabotage) Act;
    • Align gas flaring issues with the proposed Gas Flaring Bill
    • Review the provisions regarding signature bonuses
    • No provisions on venting
    • Impose scheduled process of asset disposal
    • Same duration for leases in all terrains be maintained
    • Confidentiality clauses should be revisited
    • Unfettered access to data for educational research
    • Who makes the decision to back-in?
    • Clear process on back-in
    • National Strategic Stocks – not a regulatory function but a commercial activity