News reports say a number of stakeholders have expressed concerns over various provisions of the Petroleum Industry Bill as the National Assembly began public hearing on the bill. At the hearing organised by the Joint Committee on Petroleum Upstream, Downstream and Gas, the chairman of the Oil Producing Trade Section (OPTS), Mike Sangster, who made his presentation on behalf of Total, Chevron, Exxon Mobil and Shell companies expressed concerns that the PIB Deepwater provisions do not provide a favourable environment for future investments and for the launching of new projects. The representatives of the host communities were also enraged that the governance structure of the PIB gives too much emphasis to the oil companies and very little role is given to the oil producing communities themselves.
The Petroleum Industry Bill (PIB) was first introduced to the National Assembly in December 2008. A presidential committee set up in 2007 to look into the oil and gas sector came up with this bill, which aims to increase transparency at the NNPC and to increase Nigeria's share of oil revenue. Drafts of the bill, however, became very contentious due to objections from the international oil companies (IOCs) and the Nigerian National Petroleum Corporation (NNPC). Consequently, the bill was never passed into law. Towards the end of 2015, the PIB was amended to speed up its passage and was broken into different bills, one of which was the PIGB, to address the governance framework of the oil industry. The Senate President noted that the plan was to expedite the aspects of the old law that were not controversial while the controversial areas could be placed on hold. The two houses passed the PIGB in 2018 but the President did not sign the bill till it ran out of time. President Muhammadu Buhari at the end of September 2020 finally sent the Petroleum Industry Bill to the Senate for consideration and passage and the Senate noted that the bill will be passed by April this year.
Some of the key objectives of the PIB include; safeguarding the long term macroeconomic stability of the country, reformation of the extractive industry institutional framework, provision of better clarity for Nigeria and its partners (particularly IOCs), entrenching a domestic gas to power market, increasing oil and gas production whilst protecting the environment and supporting the economic diversification agenda of the country. In order to achieve these objectives, some of the pertinent issues that the PIB seeks to address include; oil and gas royalties and taxes, regulations guiding production sharing contracts (PSC), dispute resolution between companies and the government, dispute resolution between companies and their host communities etc. Clearly, the PIB is a critical market reform needed in exploiting the untapped potentials in Nigeria's oil and gas resources.
With more than a decade of deliberations and revisions, it will be a great relief to all stakeholders if the Bill is finally passed into law. Many stakeholders hold strongly that new investments in the oil sector is dependent on the passage of the PIB which would take a more holistic approach in addressing issues around the fiscal terms especially following the passage of the Deep Offshore and Inland Basin Production Sharing Contracts (amendment) Bill, 2019 (PSC Amendment Bill).