For the Records
MEMORANDUM SUBMITTED TO THE HOUSE AND SENATE COMMITTEES ON PETROLEUM ON THE DRAFT BILL TO REGULATE THE PETROLEUM INDUSTRY IN NIGERIA. 29th July 2009.
Development Information Network makes the following submissions with respect to the Bill before this Honourable Body.
1. We submit that the industry regulatory framework should engage deeper work than has been done in the bill, as broad as the Bill currently is. We therefore suggest that in view of the fact that there are other Bills before the National Assembly with impact on the industry, this Bill be withdrawn and be represented as three separate Bills as follows:
a. A Draft Bill to Regulate the Oil and Gas Assets of Nigeria and to establish a Regulatory Body for Oil and Gas in Nigeria
b. A Draft Bill for the Management of the Oil and Gas Assets of Nigeria
c. A Draft Bill for the Establishment and Management of a National Oil Corporation of Nigeria.
2. Nigeria National Petroleum Corporation the NNPC as currently situated operates both as a regulator, operator and manager of oil assets. This MUST change and should engage this Honourable Body. Our suggestions are as follows:
a. The proposed Draft Bill to Regulate the Oil and Gas Assets of Nigeria and to establish a Regulatory Body for Oil and Gas in Nigeria will for all purposes perform the National Regulatory responsibilities to all stakeholders in the Oil and Gas sector. The Regulatory Agency will implement the National Oil Policy and Strategic Plan as designed by the Ministry of Oil and Gas.
b. The Draft Bill for the Management of the Oil and Gas Assets of Nigeria will establish the framework for Managing the Profits accruable from Oil and Gas. This framework will take care of derivation, training (Petroleum Universities, Scholarships etc), Investments(Sovereign Wealth Fund); Future Security and Community Development of the various communities where oil and gas assets are found. This will be done through various subsidiaries of the Asset Management Agency (such as PTDF, NNDC,) as well as ensure effective CSR Initiatives. This Framework and Agency will be accountable to the National Assembly through the President, who will submit and annual report (State of our Oil Asset) before the National Assembly).
c. The Draft Bill for the Establishment and Management of a National Oil Corporation of Nigeria will establish (and/or strengthen the current operations of NNPC downstream and upstream sectors). The Corporation will be treated as any other operator in the Oil Sector, except that it is owned by the government on behalf o f the people of Nigeria.
3. We believe that this present leadership should rise up and do for Nigeria what previous leaders have failed to – ensure the effective management of our national asset, of which oil and gas currently contributes 70-90%.
4. In all these legislative framework, Chapters 2and 4 of the Nigeria Constitution, All International Human Rights and Environmental Conventions signed by Nigeria and international Best Practices in Transparency and Accountability (as established through the NEITI ACT of 2007) must be fully integrated and complied with.
5. All Stakeholders in the Sector (which includes everybody!) must be fully informed and carried along in this process.
Bankole Olubamise, Executive Director, Development Information Network, Lagos.