Monday, October 11, 2021 / 09.00AM / Oluwatamilore Adeniran for WebTV/ Header Image Credit: NBCC
The Nigeria-British Chamber of Commerce (NBCC) as part of its advocacy role in economic policy, trade and development hosted a webinar that discussed the "The Petroleum Industry Act (PIA): A Reset, Setback, or Status Quo?".
At a highly interactive session moderated by Olu Verheijen, MD, Latimer Energy, which featured seasoned experts including Yemisi Awonuga, Partner, Templars Law Firm; Gbite Adeniji, Managing Partner, ENR Advisory; Adewale Ajayi, Partner & Head, Tax & Energy Resources, KPMG Nigeria and Ademola Henry Adigun, Independent Oil and Gas Consultant, the 10 year vision for the Nigerian Oil and Gas sector in the dispensation of the Petroleum Industry Act (PIA) was discussed as well as the challenges of the PIA and recommendations for improvement.
Yemisi Awonuga believed the nation should have a wholesale market, and a system where gas players have a significant place. She further explained the ripple effect of the oil & gas sector on road construction, education, and security. She called for a focused leadership that understands the benefit that gas can bring to the economy of the nation.
For Adewale Ajayi, it is about cautious optimism, as this hinges on a properly implemented PIA that will catalyze activities in the petroleum sector.
On how the incorporation of the Nigeria National Petroleum Company (NNPC) Limited, could be a game-changer for the industry, Yemisi said setting up the state oil company to be a self-functioning entity is a step in the right direction. According to her, the PIA has a lot of nice provisions that if implemented properly can lead to achieving outlined goals and creating numerous benefits for Nigerians.
She harped on the need for competent people to drive the transition of the NNPC into a commercial entity, stressing that it will be vital for the viability of the state-owned oil company when it is eventually listed in the capital market.
Assessing the development around the role of two new regulators and the government in the industry, Mr. Gbite Adeniji raised major concerns around the possible conflict between the Upstream and Midstream/Downstream agencies. He called for careful management of the relationship and a design that guarantees the independence of the agencies.
On the implications of having two regulatory agencies in the petroleum sector, Ademola Henry Adigun noted that there are about 80 countries in the globe involved in oil and gas exploration, while 65 have a dual regulatory system.
He argued that having one regulator could make them too powerful and could create some management issues. He further made the strong point for Nigeria to facilitate a midstream development strategy.
Providing his perspective on the PIA and the growth of oil production or reserves, Adewale Ajayi said when the nation grows its reserves, it can also grow its production. Ajayi noted that the requirements for the PIA are extremely large, and the country is stuck at 7 million barrels and Nigeria has not been able to meet the production quota.
For him, the PIA focuses on the issues that have not allowed Nigeria to improve production and grow its reserves - from oil reserves to focus on the production of gas.
Speaking on the widely debated issue around petroleum subsidy in the country, Ademola Henry Adigun said the high cost of living in Nigeria cannot bear the cost of petroleum without subsidy. He added that there is no clear plan for subsidy yet since the nation is still in the period of transition. The government according to him will continue to work to determine the ideal price for Nigerians.
In the area of driving the net zero emissions and sustainability, Gbite pointed out that it was not all about renewable energy. He acknowledged the energy transition fuel through gas, that is being driven as a policy in the country. He said the PIA addresses the issue of gas flaring and noted that once provisions surrounding it are implemented, Nigeria will experience one of the largest climate programs implemented globally.
The NBCC discourse on the PIA had as the Chief Host, the President of the Nigeria-British Chamber of Commerce, Bisi Adeyemi, who stated that the discourse was organised to educate and enlighten members and the public about the new realities that are likely to erupt further to the implementation of the PIA.
Watch the Full Video of the discourse HERE