Reps support liberalisation of oil & gas free trade zones

Members of the House of Representatives on Wednesday expressed support for the bill which seeks to liberalise the Oil and Gas Free Zone which scaled through second reading.

The bill also seeks for the establishment of oil and gas free zones, sub-zones and special investment areas in Nigeria and for other related matters, by amending the Oil and Gas Export Free Zone Authority Act, Cap 05 LFN, 2011.

The legislative framework, sponsored by Emmanuel Orker-Jev, Uzoma Nkem-Abonta and two other lawmakers, proposed for the amendment of section 2 of the principal Act by providing for the establishment of Oil and Gas Free Zones and Sub-Zones Authority.

As stipulated in the amendment bill, the 14 oil and gas free zones and sub-zones are: One/Ikpokiri oil and gas free zone, River State; Oil and Gas Free Zone, Owuogono, River State; Oil and Gas Free Zone, Terminal I, II & III, Warrior, Delta state; Oil and Gas Free Zone, Eko Support Services, Terminal I, II & III, Apapa Lagos; Oil and Gas Free Zone, Delta Port, Warrior, Delta State; Oil and Gas Free Zone, Snake Island, Lagos and Oil and Gas Free Zone, Ladol, Lagos.

Others include: Oil and Gas Free Zone, Olokola, Ondo/Ogun states; Oil and Gas Free zone, Iwokiri, River state; Oil and Gas Free zone, Ibaka, Akwa Ibom state; Oil and Gas Free zone, Brass, Bayelsa State; Oil and Gas Free zone, Ogedengbe, Warri, Delta State; Oil and Gas Free zone, Imgbengbe Ama, River State and Oil and Gas Free zone, Akwete-Obeaku, Abia State respectively.

Section 2(3) of the proposed amendment seeks to provide that oil and gas free zones and sub-zones established pursuant to subsection (1) of this section may be designed, developed, funded or operated by the Authority or a combination of both the Authority and a private or public enterprise.”

Proponents of the bill also seek to amend section 8 of the principal Act to reflect that: “Notwithstanding the provisions of any other enactment or law an approved enterprise, body corporate or firm operating within the free zones shall be exempted from the payment of Federal, state and local government taxes, value added tax, levies, customs duties, rates, withholding tax and deductions for as long as such enterprise continues to operate in the free zone and sub-zone.

“Notwithstanding the provision of any law, all employees in the free zones shall comply with the provisions of the personal income tax Act except those employees who work and reside in the free zones.

“Except as provided under the bill, provisions of the Federal Inland Revenue Service Act, Customs and Excise (Consolidated) Act, Companies and Allied Matters Act, Industrial Training Fund Act and other related enactments applicable in the Customs Territory shall not apply within the zones.

New amendment to section 10 of the Principal Act also seeks to empower the Authority to “take loans from banks licensed by the Central Bank of Nigeria; enter into contracts, partnership and collaborative agreement or arrangement with any company or firm or body which in the opinion of the Authority will facilitate the discharge of its function under the Act.

The lawmakers also seek to amend section 12 of the Principal Act to reflect: “in consideration of the substantial investment in oil and gas free zones, all oil and gas related cargoes must be handled only at approved oil and gas concessioned ports, however, investors are free to choose ports of discharge of their cargoes within the designated terminals at Onne, Warrior and Calabar ports.”

Likewise, sub-section seeks to provide that “A licensee may, with the approval of the Authority move machinery or equipment into the Customs Territory for the execution of special projects and return such machinery or equipment.”

Leading the debate, Orker-Jev (APC-Benue) said Onne/Ikpokiri in Rivers was currently the only Oil and Gas Free Zone by the provisions of the existing Act and the powers of the President.

He said, “the bill also seeks to expand the board of the authority and subject the appointment of Board chairman to Senate confirmation.”

According to him, if the bill is passed, it would make business more transparent, result-oriented and less cumbersome.

On his part, Uzoma Nkem-Abonta (PDP-Abia) said that the bill sought to place oil and gas businesses in their rightful place.

According to him, going by the current trends, there is need to maximise the benefit of the oil and gas free zones and ensure inclusion of local content.

The lawmaker said the amendment would help to account for all oil and gas business transactions in the country.

While ruling, Speaker Yakubu Dogara referred the bill to the House Committee on Commerce for further legislative action.

KEHINDE AKINTOLA, Abuja