Delay In Passing PIB Making Oil Sector Unattractive To Investors – Oil Marketers

The delay in the passage of the Petroluem Industry Bill is making the oil and gas sector unattractive to investors.

The National Assembly had last month postponed legislative action on the Petroleum Industry Bill by two weeks.

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The Bill which seek to repeal about 12 regulations relating to the oil and gas sector was transmitted to the Senate by President Buhari and was scheduled to debated on this week.

The Bill is expected to repeal Section 31 of the Oil Pipelines Act, CAP 07 Laws of the Federation of Nigeria 2004; Nigerian National Petroleum Corporation Act 1977 No, 33 CAP N123 Laws of the Federation of Nigeria as amended, when NNPC ceases to exist pursuant to section 54(3) 83(3) of this Act;

Others include the Associated Gas Reinjection Act, 1979 CAP A25 Laws of the Federation 2004, and its Amendments; Hydrocarbon Oil Refineries Act No. 17 of 1965, CAP H5 Laws of the Federation of Nigeria 2004; Motor Spirits (Returns) Act, CAP M20 Laws of the Federation of Nigeria 2004.

Also, the Nigerian National Petroleum Corporation (Projects) Act No. 94 of 1993, CAP N124 Laws of the Federation of Nigeria 2004; Petroleum Products Pricing Regulatory Agency (Establishment) Act 2003; and Petroleum Equalisation Fund (Management Board etc.) Act No. 9 of 1975, CAP P11 Laws of the Federation of Nigeria 2004 are expected to be repealed by the Bill.

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The PIB would also repeal Section 7, Oil Terminal Dues Act 1965; Petroleum Equalisation Fund (Management Board, etc.) Act, 1975; Petroleum Profit Tax Act Cap P13 LFN 2004, and Deep Offshore and Inland Basin Production Sharing Contract Act 2019, as amended.

Speaking at a virtual Oil Trading and Logistics Conference Africa Downstream conference, the stakeholders noted that technology remain a critical factor in the future of storage, pipelines and coastal assets in the sector.

They said there is the need for operators to embrace the use of digital technology in carrying out activities in the downstream sector.

The Chairman, Depot and Petroleum Products Marketers Association of Nigeria, Winifred Akpani, in her presentation decried tha fact that major operators in the downstream sector were yet to deploy the needed technology for their operations.

“It is alarming to see that we still do tank dipping in measuring the amount of product we have in our tank in this day and age.

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“Supervision and asset monitoring is very important, we also have geographic information systems, and supervisory control. Others include data acquisition and terminal management solutions introduced by Siemens”.

Akpani speaking further, stressed on the need for operators to embark on strategic digitalisation of their downstream petroleum assets in order to boost profitability and promote asset integrity.

He added that there are asset management systems that could be deployed to achieve the efficient management of downstream petroleum assets.

The Chief Operating Officer of OVH Energy Marketing, Mumuni Dagazau, in his remarks attributed the poor investment in infrastructure development to the delay in the passage of the Petroleum industry Bill.

He explained that the delay has rendered the sector unattractive to investors.

He said, “Due to a delay in the passage of the PIB, there is a lack of confidence in the downstream sector in terms of investment requirements.

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“PIB has been dangled for quite a while whereas its passage will create a lot of confidence for investment, not only in technology but in the development of physical infrastructure as well”

Dagazau, also noted that the need for the development of technology in the downstream oil and gas sector has been imperative not only for protection of petroleum assets, but for efficiency and speed in making decisions for both the private and public sector in the downstream industry.

“Technology is deployed for several reasons and one of such is to manage storage facilities, coordinate supply planning, promotes business efficiency and optimising transportation.

Speaking further, Dagazau stressed that unavailability of needed manpower also poses a challenge to the growth in the sector, adding that there is need to develop manpower in line with technology.

“Technology is not cheap, but if we are able to, through other means, reduce cost in taxes and support the oil and gas sector, we will witness a quick upscale of technologies in the sector.”

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