In line with legislative practice, the House of Representatives, on Tuesday, passed through Third Reading a bill for an Act to provide for Legal, Governance, Regulatory and Fiscal Framework for the Nigerian Petroleum Industry, the Development of Host Communities; and for related matters.
To this end, the Speaker, Femi Gbajabiamila, inaugurated the seven-member conference harmonisation committee, chaired by the Majority Chief Whip, Hon Mohammed Monguno, that will interface with Senate Conference Committee.
The PIB 2021 was passed after the Majority Leader, Hon Alhassan Ado-Doguwa, led the motion to pass the PIB and six other bills through Third Reading.
Other members of the harmonisation committee are; Chairman, House Committee on Banking and Currency, Hon Victor Nwokolo; Hon Aliyu Ademorin-Kuye; Hon. Kingsley Uju, Hon Tijani Ahmed Yusuf, Hon. Ibrahim Hamza and Hon Munir Soro.
The recommendations of the 74-members Special Ad-hoc Committee on PIB were adopted at the Committee of the Whole last Thursday without the contributions of some members who signified intention to make inputs.
As contained in the report, the Special Committee on PIB after its visit to Kaduna Refining and Petrochemical Company, Dangote Refinery, Lagos and Port Harcourt Refining Company as well as on-the-spot assessment visits to host communities to ascertain the impacts of oil exploration across the oil-producing states, initiated necessary reviews and came up with final report prescribing amendments to a total of 752 provisions.
When signed into law, the PIB 2021 will “strengthen accountability and transparency of Nigerian National Petroleum Corporation (NNPC) as a full-fledged CAMA company under statutory/regulatory oversight with better returns to its shareholders – the Nigerian people,” Hon Mongunu assured.
On the Frontier Basins, the “Committee recognises the need for the country to urgently and aggressively explore and develop the country’s Frontier Basins to take advantage of the foreseeable threats to the funding of fossil fuel projects across the world due to speedy shift from fossil fuel to other alternative energy sources.
“To this end, the Committee recommends additional funding mechanism of 30 per cent of profit oil and profit gas from production sharing contracts (PSCs) in addition to the 10 per cent of rent from petroleum prospecting licences and petroleum mining leases to strengthen the country’s financial capacity to explore the frontier basins.”
As stipulated in the report, in the bid to ensure adequate development of host communities and reduction in the cost of production, the Committee recommends 5 per cent on operating expenditure for Upstream and 2 per cent for Midstream and Downstream due to its high operating cost and low return margins relative to the Upstream operations.”
As stipulated in Chapter of the bill, the committee, however, expressed optimism that the bill when passed into law will “unlock the long-awaited capital investment inflow to the country’s oil and gas industry since it contains enhanced incentives in the land, swamp, shallow and deep water terrains,” adding that provisions were made for better and attractive tax incentives to achieve the goal.
Hon Mongunu who spoke during a press briefing observed that Nigeria attracted less than 5 per cent of the over $100 billion capital Investment inflow into Africa’s oil and gas industry over the past 10 years.
He said: “The House in its wisdom has decided to pass 5 per cent unanimously without a single voice of descent.
“Those that are going to be in the conference committee coming from the House it is their duty to jealously guard and protect the 5 per cent that was passed by the House because that’s the mandate of the House.
“Once they say it is a conference, there has to be given and take in the process, so I don’t want to preempt what’s the outcome of the conference.
“But what I can tell you is that the House will jealously guard and protect what it has passed,” he stressed.
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