PIB Has Been Put On Hold

Ladol

The passing into law of the all-acclaimed Petroleum Industry Bill, PIB is now on hold. According to a Nigerian senator who spoke to Reuters, deliberations on the bill has been suspended in order to solve militancy in the Niger Delta.

For many years, all stakeholders in the Nigerian oil sectors have agreed that the PIB law is needed to really transform the Nigerian hydrocarbon sector, but  the bill has been dragged by successive parliament since 2011.

The PIB is to cover everything from an overhaul of state oil company NNPC to taxes on upstream projects, has been stuck in parliament for a decade, but President Muhammadu Buhari has made passing it a key part of his reform of a sector hit by corruption at NNPC.

“We have to hold it because of all the problems in the Niger Delta,” Senator Tayo Alasoadura, chairman of the committee on petroleum resources, said of bill. “As soon as things improve, then it will come to the front of the line again.”

Despite a ceasefire reached late last month with one of the most active militant groups, others have continued to attack oil and gas infrastructure in the region. Oil minister Emmanuel Ibe Kachikwu told journalists on Monday that talks were ongoing with various groups.

The government has split the bill in two in an effort to streamline its passage, and a draft seen by Reuters earlier this year included plans to divide NNPC into two companies and sell stakes in a portion of it.

Alasoadura said there were no plans to change the bill, which had a first reading in the senate, but the unrest in the Delta, which produces the bulk of Nigeria’s oil output that typically tops 2 million bpd, forced lawmakers to wait.

“There is a deliberate effort to keep things waiting so we don’t accentuate what is happening there,” he said, adding he hoped the bill could move forward again within three to five months.

Nigeria’s revenue generation has come to more than 10 years low. Last week, data released by the National Bureau of Statistics, NBS showed that states only shared NGN143.5 billion in July compared to NGN500 billion shared in the same month last year.

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