An expert, Ben Ekori, has cautioned the sponsors of the proposed amendment of the Petroleum Industry Act, saying the proposed provision would reintroduce uncertainty, counter production, and present grave legal implications for Nigeria.
Nigerians have raised concerns over the alleged ongoing moves to amend the PIA, passed in 2021 after decades of debate.
Mr Ekori, a public affairs analyst, while reacting to the development, said such a move would erode investors’ confidence and occasion grave unintended consequences for the country and its citizens.
“That the news of the proposed PIA amendment has been in the public space for a week without denial could only mean that there could be some substance in it. While we await the confirmation of the news and its ultimate metamorphosis into a policy, it is pertinent to X-ray some provisions the proposed amendment appears to have been designed to bring about and their implications for Nigeria and its citizens.
“The proposed amendment, which is alleged to be sponsored by the Ministry of Finance, is designed with the objective of addressing the escalating fiscal leakages and revenue loss confronting the federation,” said Mr Ekori.
He added, “The reports also indicate that areas targeted for amendment include section eight, which establishes the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as the body charged with the regulation of upstream operations.
“The amendment, according to the reports, will see the NUPRC replacing the NNPC Ltd. as the representative of the government in all model contracts attached to licenses and leases provided for in section 85.”
He said that section 53 of the PIA was also slated for amendment to make the Ministry of Finance Incorporated the sole owner of the NNPCL’s shares, as against the extant situation where the company’s shares are split 50:50 between MOFI and the Ministry of Petroleum Incorporated.
The expert, however, warned that the proposed amendment to make the NUPRC the concessionaire in place of NNPCL would reintroduce uncertainty into the system, as the NUPRC would serve as both a regulator and an operator simultaneously.
He further stated that the other proposed amendment, which could have grave implications for the nation in general and the national oil company in particular, was the provision that sought to transfer all the shares of NNPCL to MOFI.
(NAN)
