• Says PIGB shrinks presidential powers over oil sector
• Experts differ on legislation, OPEC membership
President Muhammadu Buhari has withheld assent to the Petroleum Industrial Governance Bill (PIGB). The decision is coming after 17 years of rigorous consultations and legislative hassles on the document.
Sources told The Guardian yesterday that Buhari hinged his action on the argument that the bill reduces the president’s control of an industry that contributes the largest chunk to the national economy.
“The president said those he contacted among his ministers, especially the attorney general and minister of justice, claimed that presidential powers have been passed to a technocrat who might undermine the interest of the president.”
In the works for almost two decades, the PIGB has passed through both the House of Representatives and the Senate. In its torturous journey to the president’s table, contributions were taken from industry operators, oil-bearing communities, and all levels of government.
The bill was particularly being championed by Minister of State for Petroleum Resources, Ibe Kachikwu, who described it as the solution to the problems bedeviling the nation’s oil industry.
Originally called Petroleum Industry Bill (PIB) when it was presented, it was whittled down to accommodate all the variables against its passage before it received the nod of the House of Representatives as PIGB in January this year. The House and Senate versions were harmonised on March 28 before it was presented for assent.
A source said the bitter politics between the presidency and the leadership of the National Assembly could be the reason the bill was rejected.
It is also feared that Nigeria might lose its membership of the Organisation of Petroleum Exporting Countries (OPEC), if Buhari signs the bill.
This warning came from Joseph Ellah, former Group General Manager, Corporate Planning and Development Division at the Nigerian National Petroleum Corporation (NNPC).
In a new report, ‘Implication of the PIGB for Nigeria,’ published by the Claude Ake Chair of Political Economy of the University of Port Harcourt and made available to The Guardian, Ellah argued that if Buhari signs the bill, thus paving the way for government divestment, the country would contravene an OPEC resolution, which requires members to own as much as 55 per cent of their oil wealth, if they were to exercise considerable influence over it.
The PIGB states that government shall within five years from the date of incorporation of the National Petroleum Company divest in a transparent manner not less than 10 per cent of the shares of the company, which will be created after the unbundling of the NNPC. Furthermore, it is expected that within 10 years, the National Petroleum Company should divest not less than an additional 30 per cent of its shares to institutional or strategic investors.
Ellah explained that the concept of divestment, which the PIGB is designed to achieve, is actually aimed at putting the country’s future in the hands of oil multinationals and private foreign capital or their local fronts, as well as a few genuine Nigerian investors. According to him, signing the PIGB into law will succeed in recreating conditions that prevailed in the 1960s before OPEC was formed.