As Nigeria turns 61, some stakeholders in the oil and gas industry say effective implementation of the Petroleum Industry Act (PIA) 2021 will accelerate repositioning of the sector for national development.
The stakeholders made the assertion in separate interviews in Lagos on Thursday.
Nigeria will mark its 61st Independence Anniversary on Oct. 1.
According to the stakeholders, the sector needs to be repositioned because it contributes only about 10 per cent to Nigeria’s Gross Domestic Product (GDP) despite being the mainstay of the country’s economy and enabler of its economic activities.
The federal government had set up an implementation committee for the PIA which was signed by President Muhammadu Buhari on August 16 .
The new law provides opportunity for purposeful investment into the development of oil and gas resources by providing clear and simple fiscal terms that would guarantee reasonable investors margin.
Its effective implementation on public finances, oil and gas production and fiscal regime for international oil companies will improve transparency and add value to the petroleum sector.
Mr Chinedu Okoronkwo, National President, Independent Petroleum Marketers Association of Nigeria (IPMAN) said the oil and gas sector and the country lost a lot of revenue due to the delay in the passage of the PIA.
Okoronkwo said : “We, as stakeholders in the oil and gas industry, must commend President Muhammadu Buhari for breaking this jinx holding down the sector by signing the PIA.
” Now that the PIA is here, we must now put our efforts towards its effective implementation because we need to maximise our oil and gas resources as the world transits to cleaner sources of energy.”
Also, Mr Muda Yusuf, Founder, Centre for the Promotion of Private Enterprise (CPPE), said the oil and gas sector was strategic to the Nigerian economy.
“It contributes over 90 per cent of our foreign exchange earnings and over 50 per cent of revenue. This accounts for the vulnerability of the Nigerian economy to oil price and output shocks.
“Although, because of the weak domestic linkages of the sector, its contribution to GDP is just about 10 per cent. This poor linkage is also reflected in the employment generation in the sector.
“Hopefully, with the coming into effect of the PIA, some of the shortcomings around regulation and policy would be addressed,” Yusuf, a former Director General of the Lagos Chamber of Commerce and Industry said.
NAN reports that as part of the implementation of the PIA, the government constituted a new board for the Nigerian National Petroleum Corporation (NNPC) Limited and incorporated the company.
Section 53(1) of the PIA requires the Minister of Petroleum Resources to cause for the incorporation of the NNPC Limited within six months of the enactment of the PIA in consultation with the Minister of Finance on the nominal shares of the company.
The president had also forwarded the names of Mr Gbenga Komolafe as Chief Executive of the Upstream Regulatory Commission and Mr Farouk Ahmed as Chief Executive Officer of the Nigerian Midstream and Downstream Regulatory Commission to the National Assembly.
Both agencies will perform the functions of the Department of Petroleum Resources (DPR) which will become defunct once the PIA is operational.
