• Friday, September 22, 2023
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Petroleum law, the rentier state and sub-national passions


In a fragile polity like ours, the divisive potential of petroleum is such that, it is possible to draw a linkage between this resource and the mortality of the Nigerian State. This apocalyptic perspective was virtually played out in the furore, which attended the passage of the Petroleum Industry Act (PIA) in the National Assembly.

The Petroleum Industry Act itself has a long history. It took nearly twenty years before it became law. More than ever perhaps, the Laswellian definition of politics as regards ‘who gets what, when and how’, has become a source of contention between and among the law makers and the public at large-most of whom are stake-holders in the Niger Delta region. We believe that the insistent and though shrill voices on this issue, ought to be taken seriously. Else an already fragile polity like ours, may have on its hands another platform for secession and separatist agitations.

Read Also: The new PIB Act: Robbing Peter to pay Paul

Perhaps the most contentious of the sharing formula centres on what should accrue to the oil producing communities.

The communities insisted on 10 percent of the profits coming from the proceeds, while the law eventually settled for 3 percent. To worsen matters, who gets to bear the title of oil producing community is also a matter of bitter contention. As provided for in the Act, and perhaps mischievously, is the notion that the oil producing communities will also include, areas, which host the oil pipelines. The practical interpretation of this is that, a lot of the northern states, which hitherto had nothing to do with oil by way of location, would now be regarded as oil producing communities! And as such, stand to benefit from this fund. For those areas, which are the authentic oil producing communities, this is nothing short of nonsense and gross injustice.

Even then, the lopsidedness and iniquity have been deepened by the fact that in the Act, some money has also been earmarked for frontier Basins. In this instance, some princely sum of 30 percent has been earmarked for the exploration of oil. Again, many of these frontier basins are to be found in the Northern part of the country. Therefore, there is the strong suspicion that this aspect of the Act, is another ‘creative’ way of cornering resources for a particular part of the country.

Equally worrisome is the ominous dimension that the latent ghosts of Ken Saro Wiwa and Isaac Adaka Boro, have been aroused from their respective slumbers. The militant groups in the Niger Delta are rearing their heads again and issuing threats and inflammatory rhetorics, which have the capacity to threaten an already fragile polity like ours.

We are also concerned that, the provisions of the Act and the attendant discussions have given ample insight into the rentier mentality of the Nigerian ruling class, as embodied in the National Assembly and the various seemingly informed commentators. The so-called debate and discussions centred mainly on the sharing of money.

No single thought was given to the mechanics and dynamics of the productive processes, which give rise to the oil. It is a lazy mentality, which in a perverse way, hallmarks us as a nation. On this note, relevant comparisons abound in other social formations where efforts have been made to own the oil technology, such that in the course of time, the hegemonic stature of the oil companies has been reduced. The ready examples of social formations, which have succeeded in this way, are Norway (STATOIL), Algeria (SONATRACH) and Mexico (Pemex).

But rather than forge a path along this vibrant and sustainable path, our preoccupation in the Act is a continued reliance on the oil companies. Consequently, there are provisions in the Act, which seek to ensure a harmonious environment for the oil companies. Some Sixty years after the discovery of oil in commercial quantities, this is pathetic.

It also clearly demonstrates an awful ignorance of the international oil industry and the forces, which undergird same. What is clearly lacking here is that the framers of the law have not, as usual, tapped into the abundant resources in our tertiary institutions. A lot of these institutions offer courses in the areas of petroleum engineering and oil policy, and as such, their inputs would have gone a long way to infuse some relevant vision into the PIA.

That such a vision is lacking, can be observed in the combative fixation with petroleum as a resource. Whereas, as things stand, the world is currently preoccupied with the fact that, there is an energy transition in which phrases and words like, green and clean energy come up very frequently. The Act hardly spoke to this emergent scenario.