PIB passage threatened by executive, legislature conflict

The lacklustre attitude of the Executive towards the passage of the Petroleum Industry Bill (PIB) may create conflict and further deepen the losses in the oil and gas industry for the lack of a regulatory framework in the sector.
Failure to pass the PIB is said to have put on hold investments estimated at over $15 billion per annum.

BusinessDay findings show that both the Executive and Legislature are working at parallel levels on the new regulatory framework for the all-important sector, which is responsible for over 90 percent of the country’s revenue generation.

The Senate has finally resolved to forge ahead with the public hearing on the Petroleum Industry Governance Bill on the 7th to 9th December 2016, after the bill had scaled through first and second reading respectively.

Ibe Kachikwu, Minister of State for petroleum says he is in touch with the legislature but has failed several promises to transmit the executive version of the bill to the legislature for harmonistaion.  BusinessDay gathered that Kachikwu may transmit the bill within two weeks though.

But going by legislative tradition, any newly proposed bill emanating from either the Executive arm or private member bill, cannot be consolidated with bill(s) already subjected to public hearing, but can only be treated as ‘amendment bill’ to an existing Act of Parliament.

This means that if the Executive eventually transmit its version of the Legislative framework for the oil industry, after the conclusion of the Senate public hearing, it could be best considered as “impotent on arrival, as it could not achieve its set objectives,” a legislator told BusinessDay.

The development comes three weeks after Senate President, Bukola Saraki asked the Joint Committee on Petroleum Upstream, Petroleum Downstream and Gas to submit its report within four weeks.

But there are strong indications that the joint committee will not be able to meet the deadline, as its chairman, Tayo Alasoadura disclosed at the pre-public hearing in Abuja, that the panel is not in a hurry to submit its report.

“It is a committee that the Senate believes is so important that they wished that we could get our act together and if possible submit our report before we go on recess. But we have decided that we are not going to rush too much. If it is possible to do it, we do it. But if it is not possible, we are going to make concerted efforts to do what the Senate wants, but we are also going to ensure that we do a thorough job of the assignment that has been given to us,” he stated.

Previously known as PIB, it is the longest bill in the National Assembly, having been first introduced in December 2008 by the late President Musa Umaru Yar’Adua to the 6th National Assembly.

The legislative body has been in the eye of the storm over its failure to pass the PIB in two consecutive assemblies – 6th and 7th National Assembly.

Some of the contentious issues raised by the Civil Society Organisations and stakeholders’ from oil producing communities include: the exclusion of the Host Community Fund from the Senate proposal while the House of Representatives captured and recommended.

The House version of the bill provides for establishment of some agencies namely: Upstream Petroleum Inspectorate; Downstream Petroleum Regulatory Agency; Petroleum Technical Bureau; Special Investigation Unit; Petroleum Technology Development Fund; Petroleum Equalisation Fund; Petroleum Host Community Fund; National Petroleum Assets Management Corporation; National Oil Company; National Gas Company and Frontier Exploration Services.

Section 174 of the bill in the House of Representatives, provides that “the Government shall at any time within six years from the date of incorporation of the National Oil Company, divest up to 30 percent of the authorised shares of the National Oil Company to the Nigerian public in a transparent manner on the Nigerian Stock Exchange.”
Similarly, section 185 of the bill, provides that the “government shall at any time within six years of the date of incorporation of National Gas Company Plc., divest up to 49 percent of the shares of the National Gas Company to the public in a transparent manner on the Nigerian Stock Exchange.”

Critics blamed the legislative institution for rampant and prevalent corruption in the petroleum industry, which they said the bill set out to salvage.

Although Kachikwu had previously assured that the Executive would submit an executive PIB in the first quarter of 2016, Federal Government’s inability to keep to its promise in the first quarter of 2016 (Q1), prompted a private member bill by Alasoadura in the second quarter of 2016 (Q2).

During his ministerial screening last year, Kachikwu informed the upper legislative chamber that Nigeria loses $15 billion yearly due to non-passage of the bill.

But Alasoadura said the minister is also expected to give his presentation on the bill, stressing that the proposed legislation is owned by Nigerians and no arm of government should take the glory for it.

“We have scheduled the Minister of State for Petroleum Resources to also address us and address Nigerians on the part they wish to play in the bill so that at the end of the day, everybody will have gotten their input encapsulated in the bill.

“It is the bill of the National Assembly but we are co-operating with the Executive to ensure that by the time the bill is eventually passed, it is owned by Nigerians regardless of whichever divide they belong to”.

The joint committee chairman further explained that another reason why the committee will be unable to submit its report on time is that, members would embark on a tour of some oil producing countries after the public hearing.

“We are also planning that after the public hearing, the Committee will take a tour of some of the oil producing countries of the world, so that we can see what they are doing and what has made their own industry operating better than our own. We believe that we can leverage on what others have done that have helped them so far.

“We also plan to have a retreat for members of the committee before we finally come to submitting the draft of the PIB on the floor of the Senate for consideration and passage,” Alasoadura said.

KEHINDE AKINTOLA & OWEDE AGBAJILEKE