For instance, in 2011, Petronas, Malaysian national oil company took 11th position among the top 500 world’s most profitable companies with more than $17 billion profit from $76 billion revenue. Earlier in 2007, Petrobras, Brazil’s national oil company achieved Brazilian self-sufficiency in oil and recorded its highest earnings ever with more than $13 billion of profit. Again in September 2010, Petrobras conducted the largest share sale in history when $72.8 billion worth of shares in the company were sold on the BM&F Bovespa Stock Exchange. And instantly, Petrobras became the fourth largest company measured by market capitalization.
All these contrast sharply with Nigeria’s NNPC. The distressing part of the story however, is that between 2006 and 2008, a team of British accountants, Hart Group and a Nigerian firm S.S. Afemikhe and Co. released a damning report on the NNPC. According to them, “NNPC is taking advantage of its position as both buyer and agent for the seller (the government) to make profit at the expense of the federation”. Nothing has really changed and it is instructive to note here that PIB delays have further put billions of dollars of potential investment on hold.
Aside the aforementioned, I equally see hope through the local content module of the bill. The wider implication of this local content element however, is that no project will commence without a broad Nigeria Content Plan. This presupposes that every investor is obliged to purchase local goods and services, engage local businesses, employ Nigerians, guarantee knowledge transfer and engender research and development. To verify compliance, the Nigeria Content Monitoring Board will be on standby to ensure that everything is done accordingly. And for me, I see a correlation between this local content module and South Africa’s Black Economic Empowerment Scheme which addresses gross inequality, one of the legacies of apartheid. It is indeed, a broad based scheme for victims of apartheid, which include women, children and vulnerable black citizens.
I am also confident that this bill will substantially address the issues of safety, health and the environment. For instance, any company that wants a license either in the downstream or upstream petroleum sector in the country must inevitably conduct its business within the borders of international best practices. At the end of the day, the bill would have significantly protected the rights of Nigerians and Nigeria. Despite my reservations about implementation of laws in Nigeria, very often either in breach or out rightly ignored I am optimistic that the PIB will make remarkable impact.
Conscious of history and these realities in our petroleum industry, my colleagues (six in number) and I decided to sponsor this last version of the PIB (HB54) because we believe in its objectives and aims. It will not only guarantee transparency and accountability it will also boost confidence in government and generate more revenue which will lead to more infrastructural development. Whatever may happen to this last version following the intervention of the executive will not still rob it of those fine qualities that promise to revolutionize the oil and gas industry.
*Peterside, a member of the Federal House of Representatives is also Chairman, House Committee on Petroleum (Downstream)
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