New PIB favours foreign oil firms

[DT]

THE new Petroleum Industry Bill is seeking to strip the Nigerian National Petroleum Corporation of control over oil installations and to curtail the corporation's potential to be among top industry players, according to details seen by Daily Trust.

Parts of the bill propose to abolish the Incorporated Joint Ventures (IJVs) which NNPC hoped would give it an edge over international oil companies operating

in Nigeria.

The supervision of the JVs and production sharing contracts will instead turn to a new company to be called Nigerian Petroleum Assets Management Company.

The new bill, announced by Petroleum Minister Diezani Alison-Madueke recently, will maintain the status quo where the unincorporated joint ventures will continue with the major oil companies.

Section 141, under transfer of assets and liabilities, said: "(1) On the date of the incorporation of the Petroleum Asset Management Company, the assets and liabilities comprising exclusively the interest in the unincorporated joint ventures and production sharing contracts held by the NNPC on behalf of the Federal Government of Nigeria and excluding any asset that the Federal Government may have vested in the National Oil Company shall be vested in the Petroleum Asset Management Company.

"(2) The Federal Government of Nigeria may hereafter vest in the Petroleum Asset Management Company any upstream asset as the government may from time to time deem fit. And (3) The transfer of liability or obligation under this section releases the NNPC from the liability or obligation."

The provisions of the bill pertaining the IJVs will lay to rest fears by international oil companies operating in Nigeria of losing their huge profits, which would have  happened had the old version of the bill scaled through.

Under the former PIB submitted to the National Assembly by the late President Yar'Adua, international oil companies stood to lose their grip on the nation's oil

industry. They therefore waged a campaign against the bill, leading to its failure in the previous legislature.

Experts say intensive lobby and pressure mounted by the oil companies and their governments led to the watering down of the bill.

"The absence of the IJVs is a serious shortfall on Nigeria's side, as the JVs does not contain any formal arrangements, and have no prospects for NNPC's future,"

said an NNPC official, who does not want to be named.

Based on the new bill, NNPC is also going to lose control of the four refineries, depots, jetties, pipelines and other oil installations which it currently owns.

The bill says, "Oil pipelines and other installations belonging to the Petroleum Asset Management Company shall not be regarded as hereditaments or tenements to be valued for rating purposes; and for the purposes of this subsection, the expression 'oil pipelines and other installations' includes oil rigs, refineries, power generating plants, pumping stations, tank farms and similar installations but does not include office or residential buildings."

The bill is expected to be presented to the National Assembly soon though no specific date has been set.



Daily Trust