NASS To Pass PIB In Two Weeks-NNPC GMD

There are indications that the Petroleum Industry Bill which is currently before the National Assembly would be passed within the next two weeks.

The Group Managing Director of the Nigerian National Petroleum Corporation gave the indication on Tuesday during an interview on ‘Good Morning Nigeria’ show on the Nigeria Television Authority monitored by THE WHISTLER.

Kyari who is the Chairman of the Federal Government Technical Committee of the PIB, described the legislation as a game changer in the sector.

He stated that when passed into law, the PIB would help to correct the fiscal regime in the oil and gas sector in line with current economic realities.

The GMD explained that once the fiscal regimes have been updated through the PIB in line with global standards, it will put the Federal Government in a right footing to be able to negotiate with investors and attract the needed investments into the oil and gas sector.

He said, “The primary instruments that we use in regulating the sector today is the Petroleum Act and the Petroleum Profit Tax Act. Both of them and from all intentions are laws that were crafted in the late 60s.

“There have not been significant changes to the provisions of these laws and it means that this industry has moved forward over the last 50 years but we haven’t moved with that time.

“This means our laws are very archaic, it hasn’t met the requirement if today’s world in the petroleum industry in general.

“The process to amend the PIB started in 2000 and if there is no line of sight around stability of your laws and fiscal regime, nobody is going to put in any investment in the industry.

“And that is why since year 2000 till date, there are very marginal massive projects that happened in the industry. Everyone you are seeing on the table are investments that were committed prior to year 2000 and a few of them that happened are very little because we were not able to fix our fiscal regime.

“So, the PIB will correct these imbalances, it will make the sector a much more competitive business. What companies do when they make business decisions is to look at where they will make the highest returns. If your return is low, no matter what you say, no company will come and invest your country.”

He said the bill will also correct the imbalance in the downstream sector of the oil and gas sector through setting up the necessary structure for sector.

He added, “I am very convinced that the National Assembly will pass this bill, I am the Chairman of the Government Technical Committee and I and very familiar with the content of this bill.

“I am very confident that the bill will deliver what will be of value to this country and we have taking the assurance of the National Assembly; I understand that this week, it will be put on the floor of the National Assembly and if they do this, the conversation will not last more than two weeks because there is massive engagement going on.

“The end of June has come and from the assurances that we have from the National Assembly, they will pass this bill maximum in the next two weeks.”

If the Petroleum Industry Bill, is passed by the National Assembly into law, then a total of 12 legislations in the oil and gas industry may be repealed.

The need to pass the bill into law had become imperative as low oil prices and a shift towards renewable energy have made competition tougher to attract investment from oil majors.

The Regulations that are expected to be repealed with the PIB are 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; and Nigerian National Petroleum Corporation (Projects) Act No. 94 of 1993, CAP N124 Laws of the Federation of Nigeria 2004.

Also to be repealed are 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; 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.

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.

Also, the provisions of the Pre-Shipment Inspection of Oil Export Act, 1996 would be amended accordingly.