President Muhammadu Buhari has disclosed that Nigeria lost an estimated $50billion worth of investments in ten years, created by the uncertainty of non-passage of the Petroleum Industry Bill (PIB), lack of progress and stagnation in the petroleum industry.
He made the disclosure on Wednesday in his remarks at a ceremony on passage of the PIA, which preceded the Federal Executive Council (FEC) meeting.
The President said the stagnation affected the growth of the economy, citing a lack of political will on the part of past administrations to actualize the needed transformation.
President Buhari said assent of the Petroleum Industry Bill on August 16, 2021, marks the end of decades of uncertainty and under-investment in the petroleum industry.
“We are all aware that past Administrations have identified the need to further align the industry for global competitiveness, but there was a lack of political will to actualize this needed transformation.
“This lack of progress has stagnated the growth of the industry and the prosperity of our economy. In the past ten years, Nigeria has lost an estimated US$50billion worth of investments due to uncertainty created by the non-passage of the PIB.
“This administration believes that the timely passage of the Petroleum Industry Bill will help our country attract investments across the oil and gas value chain.
“In view of the value our Nation and investors will derive from a stable fiscal framework for the oil and gas industry, our Administration has found it necessary to work with the two chambers of the National Assembly to ensure the passage of the PIB, ’’ he said.
Competitive Market
President Buhari noted that the signing of the bill was part of the administration’s commitment to building a competitive and resilient petroleum industry that will attract investment, improve our revenue base, create jobs and support our economic diversification agenda.
The President said as a “nation that depends on oil resources for the development of other sectors, Nigeria runs a Petroleum Industry that is governed largely by laws enacted over 50 years ago such as the principal legislation; the Petroleum Act of 1969 and other obsolete legislations.’’
He said the Presidential assent of the bill to “Petroleum Industry Act 2021” marked the beginning of the journey towards a competitive and resilient petroleum industry that will attract investments to support the nation’s Economic Recovery and Growth Plan.
“The Petroleum Industry Act 2021” creates a regulatory environment that would ensure efficiency and accountability across the oil and gas value chain and reposition NNPC to a commercially driven National Petroleum Company that is accountable to the Federation.
“The Act also provides for a direct benefit framework that will enable the sustainable development of Host Communities. I appeal to the host communities to look carefully at the contents of the Bill which in the implementation will bring real and lasting benefits to them.
“Furthermore, the Act provides for deliberate end to gas flaring which would facilitate the attainment of Nigeria’s Nationally Determined Contributions of the Paris Agreement through a funding mechanism to support gas flare out project in host communities,’’ he added.
Immediate Implementation
President Buhari said the administration believes that the timely passage of the Petroleum Industry Bill will help our country attract investments across the oil and gas value chain.
While directing the immediate implementation of the framework for the Petroleum Industry Act (PIA), he urged all relevant stakeholders to comply and reposition for full activation within 12 months.
The President said the Minister of State for Petroleum Resources, Timipre Sylva, will head the implementation team, urging all Ministries, Departments and Agencies (MDA) to adjust to the transition, designed to reposition the economy.
“To consolidate the commitment of this administration to delivering the value proposition of this law, I have approved an implementation framework commencing immediately to ensure the industry envisaged in the new law begins to take shape.
“The implementation process to be headed by the Hon Minister of State, Petroleum Resources is hereby tasked with the completion of the implementation of this act within 12 months. I am therefore directing all relevant Ministries, Departments and Agencies of government to fully cooperate in ensuring the successful and timely implementation of this law,’’ he said.
President Buhari commended the leadership of the 9th Assembly for their continued pursuit of national aspiration and demonstration of mutual harmony with the Executive in the pursuit of patriotic outcome in the passage of PIB.
“I also commend the entire team in the executive that worked tirelessly to ensure the delivery of this strategic legislation for our country. I thank Nigerians and other industry stakeholders for their contributions and support in achieving this historic landmark,’’ he said.
Ninth Assembly legacy
President of the Senate, Ahmad Lawan, who spoke to State House correspondents after the president’s statement, said that the members of the National Assembly took the passage of PIB as one legacy that the Ninth Assembly should leave by the time they complete their tenure.
“We want to make it clear that everybody in the NASS, in both the Senate and the House, from all parts of Nigeria, worked for the bill to be passed.
“The debates were, of course, very lively and sometimes even difficult ones. But that was to show the emotive attachments that everybody had for the bill to be passed.”
$500million for host communities
Lawan said that even though some analysts have said that the 3% provided in the Act to host communities was not enough, the about $500million expected to accrue to them would accomplish a lot if prudently and transparently managed.
“The host communities are winners as well. It may not be necessarily exactly what some of them had hoped, but from zero to $500million, I think, it is a big jump.
“With time, such issues could be further addressed, but I want to also caution that it is not the $500million that is small but how we able to prudently and transparently deploy the $500million in the host communities.
“This time around there should be no excuse for anybody to tamper with this money. The host communities have suffered enough.
“Even the NDDC (Niger Delta Development Commission) was established for the host communities; yet the host communities did not get much attention.
“This time, the host communities have been specifically mentioned and these funds will go there. We want to see people who will be appointed taking this as trust and doing what is right.”
Lawan said that the greatest lesson to learn from the passage of the bill and the accent given to it by the president is that Nigeria would benefit a lot when the executive and the legislature work together.
The ceremony was attended by the Senate President, Dr. Ahmed Lawan, Deputy Senate President, Ovie Omo-Agege, Deputy Speaker, House of Representatives, Ahmed Idris Wase and other lawmakers, members of the Federal Executive Council (FEC) and Group Managing Director of the NNPC, Mele Kyari.
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