Live blogging the Senate public hearing Day 2

The Senate public hearing commenced at 12:40

Natural Resource Governance Institute – PIAB

  • include checks in the presidential discretionary award of licences;
  • introduce beneficial ownership;
  • emphasise issues of transparency in asset register;
  • clear guidelines on bidding rounds.

Petroleum Training Institute Effurun

  • want to be included in the bill

Nigeria Gas Association

  • fiscal terms to be reduced and incentives to be provided for gas development;
  • AGFA should be retained;
  • cost efficiency factor should not be applied to gas development;
  • need for clarity in the definition of upstream and midstream;
  • worked examples should be included in the fiscal bill;
  • specific provisions for marginal fields and indigenous companies.

Dangote Group

  • third party access may discourage investment;
  • bill does not make provisions for entities in Free Trade Zones;
  • clarity on the host community provisions;
  • clear tenor for the advisory committee in the petroleum host community bill.

live blogging continued – Delta State Government

Joint memorandum between Delta State government and its host communities

  • settlor and communities should appoint the trustees
  • trusts should be established within 3 months
  • 5% of gross revenue;
  • 50% of gas flaring penalties should be given to the host communities;
  • take off grant to include 20% of license fee;
  • objective should include creation of employment opportunities;
  • members of the board of trustees should serve for only 4 years;
  • secretary of the board of trustees should come from the host state;
  • allocation of a specific sum for traditional rulers and for the management of the fund;
  • surveillance contractors should be appointed in consultation with the host communities;
  • state governments should be involved in dispute resolutions;
  • legacy projects should be split into phases;

Late live blogging at the Senate public hearing continued

HOSTCOM

  • Relationship should be a tripartite relationship between FG, Host Community & Oil Companies;
  • 10% equity partnership;
  • Representatives in the board and management committees of oil companies;
  • No multiple trusts with various oil communities;
  • A National trust fund should be administered by Hostcom and traditional rulers;
  • Hostcom to nominate those who will be responsible for managing the funds;
  • Hostcom should serve on the board of the regulatory commission;
  • IOCs must set up refineries in Nigeria;
  • Gas flaring penalties should be paid to Host Communities;
  • Communities should not be penalised for pipeline vandalism;
  • Nigeria must control majority shareholding in the national oil company;
  • Hostcom must be included in every government institution;
  • Host communities must have the first right of refusal in any privatisation.

Late live blogging of the Senate Public Hearing on Petroleum Industry Reforms

We arrived late at the Senate’s public hearing on the three public hearings today. We will give a summary of all the presentations earlier.

Ministry of Petroleum Resources – Fiscal Bill

  • many fiscal abuses in the current Fiscal Bill;
  • lack of fiscal neutrality in the bill;
  • bill does not sufficiently reward the domestication of oil

Administration Bill

  • more reflection on the powers of the Minister;
  • opportunity for checks & balances over the Commission by the Minister;
  • there should be a requirement for bid rounds every 3 – 5 years;
  • the decision on bid round should be a political decision;
  • Minister to give guidelines;
  • who regulates the regulator?
  • provisions for acreages to the commission to be amended and explicitly granted to the state;
  • more provisions for contract transparency;
  • gas flaring provisions are scaled back in this bill;
  • national strategic stocks should be handled by a regulated entity;

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 petroleumindustrybill.com

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

  • 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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