Hope rises as Senate gets report on PIGB

Hopes of unbundling the Nigerian National Petroleum Corporation (NNPC) and creating a window for further development in the petroleum industry received a major boost on Thursday,  as the Senate has received the report on the Petroleum Industry Governance Bill (PIGB).

The report which was presented by the Joint Committees on Petroleum Upstream, Petroleum Downstream and Gas, came three months behind the January deadline given by Senate President Bukola Saraki.

It was presented at Thursday plenary by Tayo Alasoadura, chairman of the joint committees.

Checks by BusinessDay revealed that the report will be debated on April 24, two days after resumption from Easter break.

The Petroleum Industry Governance Bill (PIGB) previously known as Petroleum Industry Bill (PIB) is one of the 11 economic reform bills before the National Assembly, meant to get Nigeria out of economic recession as well as improve the country’s ranking in the World Bank Ease of Doing Business report.

Nigeria occupies 169th position out of 190 countries in the World Bank Ease of Doing Business index for 2017.

The bill is the longest in the National Assembly, having been first introduced to the Sixth Assembly in 2009 by the administration of late President Umaru Yar’Adua.

Although the Bill passed Third Reading in the 7th House of Representatives, the Senate then did not concur as the Bill could not get to the Third Reading stage.

Sponsored by Tayo Alaosuadura (APC,  Ondo Central), the PIGB provides for the Governance and Institutional Framework for the Petroleum Industry.

Objectives of the bill are to: create efficient and effective governing institutions with clear and separate roles for the petroleum industry; establish a framework for the creation of commercially oriented and profit driven petroleum entities that ensures value addition and internationalization of the petroleum industry; promote transparency and accountability in the administration of the petroleum resources of Nigeria and
foster a conducive business environment for petroleum industry operations.

PIGB focuses mainly on privatisation of the petroleum industry as it splits the NNPC into three different entities, viz: The Nigeria Petroleum Regulatory Commission (NPRC), National Petroleum Assets Management Company (NPAMC) and Nigeria Petroleum Company (NPC).

While the NPRC will serve as a regulatory entity for the entire petroleum industry (upstream, midstream and downstream), the NPAMC will serve as the counter-part and administrator of production sharing agreements and such other risk-based agreements as the government may decide to conclude.

The bill also envisages NPC to serve as an integrated oil and gas company operating as a fully commercial entity across the value chain.

NPC’s activities will include joint venture operations, operation of the Nigeria Petroleum Development Company (NPDC), frontier exploration and other upstream/service activities, refineries and petrochemicals, downstream activities and sale and disposal of crude oil and products.