April 12, 2021 / 12:03PM / Ottoabasi Abasiekong for WebTV / Header Image Credit: Ecographics
The privatization of all Nigeria's state-owned petrochemical refineries is the best option for increasing private sector participation in the oil and gas sector. Tengi George-Ikoli, the Program Coordinator Nigeria Natural Resource Charter disclosed this in a recent conversation on "Achieving Transparency and Accountability In Nigeria's Oil and Gas Sector".
Speaking on the Federal Government's recent decision to rehabilitate the Port Harcourt refinery for $1.5bn, she said a full liberalization would have brought more transparency to the process and opened up the opportunity for accessing increased private capital.
She brought into perspective the fact that despite millions of dollars deployed in the turnaround maintenance (TAM) of the four refineries in the country over the past decade, the performance of the refineries has been abysmal at 10% utilization.
Looking at the Petroleum Industry Bill (PIB), which is under deliberation for passage by the National Assembly (NASS), she believed that when passed and signed by the President the legislation would achieve the following objectives;
She said that the PIB was a holistic bill that could open up the economy and create more jobs for a nation that was grappling with rising unemployment (recently placed at 33.31% as of January 2021).
On leveraging the capital market to list Nigeria's oil and gas assets & entities, she cited examples of State oil companies like Saudi Aramco(Saudi Arabia), Equinor (Norway), Petrobras (Brazil), that have gone to the capital market, opening them up to higher governance standards while creating larger market value.
Ikoli said Civil Society Organizations like the NNRC have played crucial roles in pushing for accountability from the government on decisions and policy steps in the Oil and Gas sector, from the subsidy to improved legislation through PIB, and deregulation of the sector.
Giving her views on the "Decade of Gas" policy of Nigeria (2020 to 2030), Ikoli lauded the initiative but emphasized grey areas that need to be addressed which would include the following ;
As a nation blessed with other mineral resources apart from oil and gas, the NNRC Program Coordinator emphasized the need for Nigeria to reform its solid mineral sector in a way that could expand the country's revenue base.
She called for collaborative efforts amongst all relevant ministries, departments, and agencies (MDAs) to address leakages, entrench systems and structures, deepen institutional reforms and improve regulatory oversight.