Olisa Agbakoba, a senior advocate in Nigeria and a former chairman of the Nigerian Bar Association, has demanded that the Petroleum Industry Act be repealed, claiming that its drafters committed grave mistakes.
In contrast to the prominent Nigerian lawyer’s opinion, the federal government’s oil and gas regulatory bodies—the Nigerian Upstream Petroleum Regulatory Commission and the Nigerian Midstream and Downstream Petroleum Regulatory Commission—held that the PIA was beneficial to the country’s economy.
At a news conference in Ikoyi, Lagos State, Agbakoba stated that Saudi Aramco’s oil and gas system could serve as an example for Nigeria to follow.
Why the Act established so many redundant agencies was a mystery to Agbakoba.
As we discussed or reviewed our issue, it became evident that the Saudi Arabian situation is structured in a way that is at odds with the regulatory legal procedure architecture.
There are already five or six agencies in Nigeria thanks to the PIA, and it might be confusing to keep track of who does what with all the new ones popping up. The PIA should be repealed right away. Therefore, he said, “any process could fail” if there isn’t enough information.
The lawyer pleaded with the government to establish a mechanism that would allow local players to fully participate in the business.
Local players, not funding, are the issue. Plenty of money is available to meet everyone’s demands. Actually, if the money flowing in from oil and gas could be discovered and kept, Nigeria would be a very rich nation. However, this is not the case because Nigeria’s president has claimed to be the minister of petroleum. That just won’t work.
Electricity, hydrocarbons, and everything else is overseen by Saudi Arabia’s ministry of energy. There is only one domain for anything. There will be chaos, though, if you have multiple ministers. President Obama’s energy policies take a back seat whenever he is busy. Petroleum is a highly prized resource. Revenue is generated by our hydrocarbon. The Production Sharing Contract was a naive way for us to give up control of our company to the international oil companies.
The country’s hydrocarbon process, says the former NBA president, is incoherent and has led to some serious errors.
The minister of state for petroleum is ineffective; his role is that of a spare tyre. A more powerful entity, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, has surpassed him.
“The NNPC GCEO now wears two hats as an employee of the PIA. Reading the legislation without being able to discern the specific function of the office is rather perplexing. Not only is he an oil operator, but he is also the state’s oil regulator. He juggles two tasks at once, and he’s not very good at one of them. You are either involved in regulation, like Saudi Arabia’s minister of energy, or you are a player, like Chevron.
The International Olympic Committee takes use of this loophole to exclude Nigerians. They will not receive any money if they do not distribute it to Nigerians. We are cash-strapped in the oil and gas industry because the structure supporting it has collapsed. It is necessary to construct a new set of regulations for the oil and gas industry, he said.
Like Saudi Aramco, the NNPC ought to be efficient. It makes no difference if it’s public or private. Nigerian interests must be honed. While the international oil companies purported to finance our oil wells, the country unknowingly ceded control of its actual assets to them. Nobody from the IOC has to hand over their cash to us. He pointed out that Saudi Arabia’s decision to not allow IOCs was evidence that they do not offer value.
After many Nigerians fought for nearly 15 years to pass the PIA, the legal luminary was asked to explain why he believed it should be repealed, and he responded, “Is the PIA a right or wrong decision?” Please refer to the PIA when making comparisons to the energy infrastructure in Saudi Arabia, as far as I can see. No, the PIA violates the constitution. According to Section 62, the NNPC has the authority to take funds.
