The Progressives Governors Forum (PGF), has described Monday’s signing of the Petroleum Industry Act by President Muhammadu Buhari as a sign that he is democratically changing Nigeria for good
PGF in a statement issued by its chairman, Governor Abubaka Atiku Badaru of Kebbi state, noted that by the president assenting to the Petroleum Industry Bill (PIB) indicates a move to restructure the operations and management of the Nigerian oil and gas industry, adding that with the coming into law of the new Petroleum Industry Act, once more the APC party under the leadership of President Buhari has demonstrated unwavering commitment to change Nigeria democratically.
“After more than two decades of endless national debates and stalemate, there is today a new Petroleum Industry Act in the country, which has provided six months transition for the emergence of new institutional framework for the operations of oil and gas industry in the country.
“The Progressive Governors Forum (PGF) commends Mr. President for this historic feat of moving the nation forward to a new democratic era of governance and business management of the oil and gas industry. With Nigeria National Petroleum Corporation (NNPC) now unbundled, and in its place three new structures – Nigerian Upstream Regulatory Commission, Nigerian Midstream and Downstream Petroleum Regulatory Authority and Nigerian National Petroleum Company Limited – stronger accountability structures, each with a Board drawing representation from stakeholders in the oil and gas industry is instituted. The monopoly status of the old NNPC, which vested it with both the powers of regulating the industry as well as extraction and sales of crude oil in both the upstream, midstream and downstream has been abolished.
“With the new Act, the task of regulation is vested in the two regulatory bodies created by the law. While extraction and sales of crude will now be undertaken by both the new Nigerian National Petroleum Company Limited and other private companies in both the upstream, midstream and downstream, in line with regulatory standards respectively provided by the Nigerian Upstream Regulatory Commission and Nigerian Midstream and Downstream Petroleum Regulatory Authority created by the Act.
“In addition, the Act also created a Host Communities Development Trust to be managed by Board of Trustees. As provided by the Act, 3% of profit from the operations of oil and gas businesses will be used for the development of the host communities. It is noteworthy that this is in addition to the existing 13% derivation to oil producing states and funds allocated to Niger Delta Development Commission (NDDC), which Mr. President has continuously emphasised that all the resources must be put to judicious use for the benefits of the people in the oil producing areas.”PGF stated
The progressive Governors stated further that Part III, Section 9 (4) and (5) of the Petroleum Industry Act provides for the creation of “a Frontier Exploration Fund which shall be 30% of NNPC Limited’s profit oil and profit gas as in the production sharing, profit sharing and risk service contracts, adding that ‘This is a provision made to ensure that NNPC Limited transfer 30% to the Frontier Exploration Fund dedicated for the development of oil exploration activities in all parts of the country subject to appropriation by the National Assembly. This provision will guarantee exploration activities in the country beyond discretionary decisions of the management of the new NNPC Limited.”
It argued that the new Petroleum Industry Act present a convincing credential of the commitment of our party, All Progressives Congress (APC), to restructure Nigerian economy through democratic process in line with provisions of the 1999 Nigerian Constitution as amended. Inspired by our leader, President Muhammadu Buhari, we are confident that democratic engagements based on strategic considerations of legislative proposals in the National Assembly to make or review existing laws, the Nigerian economy will be fully restructured.
“Even critics of our party, APC, and our governments cannot ignore the fact that the coming into law of the Petroleum Industry Act is an important democratic milestone. It signposts the commitment of our party and our government to develop the oil and gas sector and resolve all the challenges associated with the operations of the sector. With the new Act, there should be remarkable improvement in revenue collection from the oil and gas sector. This is expectedly the Next Level governance initiatives our party has promised Nigerians during the 2019 campaigns.”