House of Reps Passes Petroleum Industry Bill

Channels Television reports that the House of Reps’ Ad-Hoc Committee report on the PIB has been considered and that the Bill has been passed by the lower house.

This comes after a flurry of Bills (46 in total) were passed by the Senate yesterday, June 3, after same were transmitted by the House of Reps.

The House of Reps’ passage of the PIB comes to little or no avail as the 7th Assembly wrapped up today. The Bill would have also required passage by the Senate.

Indeed, Senate president, David Mark, in his End-of-Assembly speech, admitted the lawmakers failure to pass the Bill.

The PIB has been before the House of Assembly since July 2012.

Splitting up PIB not in Nigeria’s Interest says PENGASSAN

Reacting to the Minister of Petroleum’s suggestion that the Petroleum Industry Bill be split up to ensure prompt passage, the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has retorted that such suggestion would not be in the interest of the country. The association maintained that the provisions, as contained in the current Bill, are capable of transforming the industry and in particular, grow the upstream sector.

SENATE SHIFTS PIB HEARING / EXCERPTS FROM HOUSE OF REPS HEARING ON JULY 11, 2013

The Senate’s two-day Petroleum Industry Bill (“PIB”) public hearing session, initially slated for July 16 and July 17, 2013, has been moved to Thursday, July 18 and Friday, July 19, 2013.

The hearings were moved as a result of the Senate’s planned vote on Constitutional amendment and  a valedictory session in honor of the late Senator Pius Ewherido both taking place on the 16th and 17th of July respectively.

The Senate’s hearing will now come up exactly one week after the House of Representatives’ final public hearing on the Bill.

Although hearings failed to hold on Wednesday, July 10 as initial stated, the House of Representatives, on the second day of hearings, played host to a cross-section of stakeholders in the oil and gas industry made up of the National Union of Petroleum and Gas Workers Association (NUPENG), Petroleum and Natural Gas Senior Staff Association (PENGASSAN) and other interested stakeholders as reported.

Both NUPENG and PENGASSAN, in a joint presentation, submitted that the Bill conferred excessive powers on the Minister and as such encroached on the powers of the Regulators. The Unions’ position was also shared by Malam Nasir Ahmed El-Rufai.

Speaking in his capacity as Director of the Centre for Africa’s Progress and Prosperity (“CAPP”), El-Rufai suggested that Joint Ventures be incorporated and quoted on the stock exchange to encourage Nigerian’s participation in the petroleum industry. He also panned the President’s indiscriminate powers to allocate acreages.

The General Manager (Commercial), Shell Exploration and Production Africa, Marc den Hartog, said the company “fully supports the aspirations of government as contained in the PIB.” He however suggested that the PIB clearly define the roles and responsibilities of entities, especially those of the Regulators so as to avoid overlaps and conflicts.

NEITI’s Executive Secretary, Hajiya Zainab Ahmed, suggested that the PIB provide for a public register of corporate entities that bid for, operate or invest in petroleum upstream assets, including the identities of their beneficial owners and their levels of ownership. She also urged for provisions that would allow for cash-call payments for Joint Ventures as a first line charge on the Federation Account. “This means that the federal government’s share of the expenses for JV operation would be paid based on agreed work-plan and budgets directly from the Federation Account, prior to other disbursements from the said account,” she said.

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.