PIB: Now that public hearing is over

In more than a fortnight ago, both houses of the National Assembly concluded public hearing on the much awaited Petroleum Industry Bill (PIB). The focus at the moment has shifted to what respective committees of the two chambers might turn in as reports for consideration and endorsement of the larger houses. JOSHUA EGBODO writes on the expected outcome from the House of Representatives, especially from leading advocacy groups on the PIB.

Echoes from the public engagements

With the mandate of the House of Representatives to its special Ad hoc committee on the PIB under the leadership of Chief Whip of the House, Tahir Monguno, raised by Speaker Femi Gbajabiamila, the panel organised and concluded a public hearing on the proposed legislation, which was transmitted to the parliament in September, 2020 by President Muhammadu Buhari.

Vested interests have remained an obstacle to smooth passage of the Bill, which have been before the National Assembly for about two decades now. Such interests have blamed on international oil producing companies, and internal politics, as well as regional and ethnic sentiments. Even as a lot has been achieved as far as the proposed law was concerned, many still fear that such interests may not disappear like a mist under heat. 

At the commencement of the public hearing, Speaker Gbajabimila also expressed fears over such interests, which he believed were yet up in arms against the PIB, when he said the National Assembly was not oblivious to the fact of many contending interests, adding that “these contentions do not need to result in conflict, especially when we know the objective of national prosperity benefits us all.

“Therefore, the process of engaging with stakeholders will continue beyond this public hearing to accommodate the diversity of interests and ensure all critical views form part of the deliberations that inform the final legislation”.

Committee charged

Many, both groups and individuals involved in advocacy for passage of the PIB has commended the leadership of the House, especially for offering encouragement to the Ad hoc committee. Gbajabiamila to such pundits, had made comments which were highly reassuring on the current House’s determination to pass the PIB this time.

“We intend to pass this bill by April (2021). That is the commitment we have made. Some may consider it a tall order. But we will do it without compromising the thoroughness,…we have an opportunity and an obligation to do better, and we will”, Gbajabiamila told audience the public hearing.

Gbajabiamila said it was unfortunate that in spite of the importance of the bill to the growth of the country’s economy, it has not been passed into law by previous assemblies, assuring that there was already a great understanding amongst citizens that it is passed into law. “We did not arrive at this consensus suddenly. For a long time, we have known that this critical national industry underperforms its potential and our national expectations.

“For the most part, we all agree on the need for legislative action to make improvements through statutory and regulatory reform. Therefore, it is disappointing and frankly difficult to explain how successive governments have failed to deliver on the promise of reform despite this broad agreement.

“Regardless of whatever other interests may exist, Nigeria’s best interests is both our desired outcome and guiding principle. It falls to this Ad-Hoc Committee to engage in a necessary balancing act in the interests of our beloved nation…. For a country such as ours, as dependent on income from this (petroleum) industry as we are, this is a dire possibility made worse by the inefficiencies that bedevil our local industry and deprive us of the full benefits that ought to derive therefrom”, the speaker said.

Readiness pledged by panel 

Expressing the readiness of the committee to work in tune with disposition of the House’s leadership, Chairman of the Adhoc panel on the PIB, Monguno said the proposed document before the panel was long overdue, becoming a law for the country. “Nigeria’s oil industry operates in a global environment that is constantly shifting in favour of countries with the most competitive, accommodating legislative instruments. The absence of these factors has resulted to the loss of significant amount of investments.

“In an effort to address the present state of quagmire in our oil and gas industry, we must put in place a legislative instrument such as this, which establishes a fiscal framework to boost oil and gas output, enhance sector attractiveness for international investors.

”This will increase foreign direct investment, which will undoubtedly catalyse Nigeria‘s economic recovery. It also places strong emphasis on developing a domestic gas market in Nigeria by providing measures to encourage companies to explore and produce gas from discoveries, as well as a framework for gas tariffs and delivery…As we gather here today, we may differ in opinions and background but the consensus is that the passage of this Bill is long overdue”, Monguno said.

Host communities’ brawl

A dramatic brawl between representatives of oil producing host communities ensued on the second and last day of the public hearing in the House of Representatives, disrupting the session for a good moment. To many, the development presented a signal to one of the greatest obstacles, and the likely failure the law will face in implementation, if eventually enacted.

Experts’ perspectives 

Experts with interest in Nigeria’s oil and gas sector has called on the National Assembly to remain focused, and keep its promise of passing the PIB within the shortest possible time, especially the House of Representatives, which has given an April timeline, through its Speaker, Femi Gbajabiamila.

Addressing participating journalists in a strategy meeting on reforming the oil and gas sector in Nigeria, a follow up engagement after the National Assembly’s public hearing on the PIB over the last weekend, organised by the Facility For Oil Sector Transformation (FOSTER), Engr. Joe Nwakwue said that host communities should understand that some of their requests, especially like having to take greater share of gas flare penalties were “social costs that all of us bear” as citizens.

While also calling on the government to opt for a programme of reinvesting such penalties from gas flaring in a pull of fund for future purposes, and not to be seen as a revenue itself, he said it would be difficult to have a timeline for flare-out in the PIB, as getting that done at the moment require huge investments from the oil producing firms, who would for that reason prefer paying the fines.

Also speaking on some possible advocacy issues that can see the early passage of the PIB, Mr. Oke Epia, publisher of the Order Paper said the Bill as it is can never be one law that will address all challenges of the sector in a moment. He, therefore, advised that the Bill be passed in spite of the divergences, which could subsequently be revisited through amendments.

He recalled that a forum of experts engaged to review the Bill, after the National Assembly concluded public hearing on it collectively “acknowledged that the PIB is an urgently required legislation which passage will benefit ALL interests and stakeholders, including the Government of the Federation of Nigeria, State Governments, the Host Communities, Companies, workers and several other players and interests of the petroleum economy of the country”. 

Final expectations 

While the push is on for urgent passage of the PIB, experts have suggested that the parliament should pay attention to such issues as; community ownership of development choices, plans and delivery, responsibility for security of assets, explicit definition of the term ‘host community’, and harmonization of environmental regulations, amongst other issues.

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