Petroleum Industry Act, Significant milestone in Nigeria’s Oil and Gas industry—-ANEEJ
BENIN-CITY, NIGERIA. August 18, 2021… The Africa Network for Environment and Economic Justice (ANEEJ) has welcomed the signing of the Petroleum Industry Bill into law by President Muhammadu Buhari saying it is a significant milestone in Nigeria’s quest for a better managed Oil and Gas industry and urged government to begin now to use proceeds from oil and gas to invest in non-oil sector for the future of generations as the world is shifting away from fossil fuel as being implemented vide the Paris Carbon Agreements.
The Executive Director of ANEEJ and foremost Campaigner for the passage of the PIB in Nigeria, the Rev David Ugolor in his official reaction remarked that it has been a very long road coming with the agitation for the law and as such it is a welcomed development, but urged the Federal Government to take the issues raised by critical stakeholders into consideration in the implementation of the new law.
“We welcome the signing of the Bill by President Buhari, as it will help to reposition the oil and gas industry for profitability even though the world is moving away from fossil fuel to renewable energy sources, the new Petroleum Industry Act will help to shape operations in both Upstream and Downstream of the Industry and will likely end ‘business as usual’ mentality plaguing the sector. It is important that the country begins now to save and invest from proceeds of oil for the future generation of Nigerians.
“The Petroleum Industry Act will create confidence amongst investors and industry actors alike and it will help attract the direly-needed Foreign Direct Investments (FDIs) in the sector. I believe it will bring about the unbundling of the NNPC and new companies would emerge, more opportunities will arise for oil majors and government in particular,” Rev Ugolor said of the Petroleum Act 2021.
The foremost campaigner for the passage of the PIB, however, called on President Muhammadu Buhari-led Federal Government not to lose sight of the concerns raised by stakeholders in the oil producing communities and the role of the Minister of Petroleum resources that is so powerful acting as a regulator and actor at the same time which are now part of the new Petroleum Industry Act.
Rev Ugolor noted that the new Act was not explicit on how the 30% for Frontier Oil Exploration and charged to Buhari administration to evolve a mechanism acceptable to all stakeholders on how the funds would be deployed to avoid crisis in the sector.
In the same vein, he tasked government to evolve a bottom-up approach on how the 3% profit allocation to oil producing communities would be disbursed in ways and manner that it will not lead to conflict in the region and that the oil majors do not take advantage of the law to undermine host oil communities’ rights.
The ANEEJ boss Further stated that “as it stands today, Oil producing communities are concerned over a portion of the Act that ceded a three per cent to Host Communities Development Trust Fund and 30 per cent of NNPC Ltd profit to Frontier Oil Exploration Fund. Government should address this issue.”
Ugolor further tasked the Federal government to creatively use anticipated increased oil revenue to ensure that aftermath of insurgency in the North East and banditry in North West/North Central are effectively addressed and provide citizens of the area a ray of hope and opportunity to regain their livelihoods to avert famine and humanitarian disaster. Government, Ugolor advocated, should take proactive steps to address these issues because it will not be good that investors face another crisis in the oil producing communities or in the north as the new Petroleum Industry Act comes into effect.