Nigeria’s government plans to create a powerful energy regulator with broad oversight of the oil and gas sector, according to draft versions of sweeping reforms known collectively as the Petroleum Industry Bill (PIB).
The draft laws, posted on the Nigerian legislature’s website on April 30, are the versions intended for the Senate, the upper house of parliament.
The PIB aims to improve transparency, attract investors, stimulate growth and increase government revenues.
After being debated for well over a decade, the unwieldly and contentious legislation WAS broken into sections to help it pass into law.
The governance part of the bill was passed by both houses of parliament in January. However, that section has not yet been signed into law by President Muhammadu Buhari, who is also Nigeria’s oil minister.
The inability to pass the law and uncertainty around taxation has stunted investment in the west African nation, particularly in deep-water oil and gas fields.
The three PIB sections yet to be passed address fiscal and administrative issues and local communities affected by the oil industry.
The administrative bill largely deals with the scope of the Nigerian Petroleum Regulatory Commission, which would be the main body regulating the oil and gas sector in the country.
The fiscal bill sets out the rates of tax and royalties for various oil and gas enterprises, as well as various breaks such as upstream gas operations receiving a tax-free period of five years from the start of production.
The third draft section of the PIB addresses communities that host or are affected by oil and gas sector work, and would compel energy firms to create a fund to develop those areas.
On Tuesday, Senate President Bukola Saraki told Reuters Nigeria’s parliament aims to pass the long-delayed PIB by the end of July.
Reuters
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