From Fred Itua, Abuja

Senate, yesterday, passed for Second Reading,  the first batch of the Petroleum Industry (PIB), sponsored by Senator Tayo Alasoadura.

The  new bill is titled Petroleum Industry Governance Bill, 2016.

A part of the bill seeks the unbundling of the Nigerian National Petroleum Corporation (NNPC) into two separate entities.

Senator Alasoadura said the second entity, which will be created from NNPC, will be named National Asset Management Company (NAMC).

He explained: “This bill provides for the unbundling of the NNPC into two independent entities, which are the National Petroleum Company (NPC) and National Asset Management Company.

“It also provides for the establishment of a single petroleum regulatory commission which will focus mainly on regulating the industry. The poor performance of the NNPC is a major concern. The commercialisation of the corporation and its splitting into two entities is for more efficiency and to enhance performance.”

On April 26, the upper legislative chamber abruptly ended debate on the bill and its consideration was subsequently delayed until yesterday.

This is the first in a line of bills on the petroleum industry.

This was even as Senate President, Bukola Saraki instructed Alasoadura’s Committee on Petroleum Resources (Upstream), to prepare and submit a PIB which deals solely with issues of host communities and fiscal considerations.

This version of the PIB deals with provision of institutional framework for governance in the nation’s oil and gas sector.

The Senate President’s directive came amidst protests from Senator James Manager, from Delta State, who, during his contribution to the debate on the bill, faulted the priority accorded the first leg with objectives mainly on governance.

Manager frowned at the way and manner the Niger Delta region, which he noted, produces the nation’s oil  has been treated, saying while the discovery of oil in commercial quantity was a blessing to other parts of the country, it was a curse to its host region.

He said the injustice done so far to the region must be urgently addressed with the passage of the second leg of the bill that would recommend ten percent from oil revenue for the host communities.

“My respected colleagues, the oil bearing communities deserve 10 percent from the oil revenue.  It is on that that I stand.”

He added: “My contributions as far as this bill is concerned, will be very limited. The PIB was first introduced between 2007 and 2011 Senate. It resurfaced between 2011 and 2015. Unfortunately, the bill did not see the light of the day. My respected colleagues, the discovery of oil in commercial quantities at a place called Oloibiri, in the present day Bayelsa State, has brought blessings to all Nigerians and blessings to all those who are not Nigerians but have been dealing with us from outside the country. But behold, this discovery of oil that has brought blessings to all of us is also a curse to the Niger Delta people. A very terrible curse to the Niger Delta people.

“You need to see things for yourself. A visit to Oloibiri, where oil was discovered in commercial quantities before the independence of this country in 1960 will tell the full story.

Saraki, while directing the committee, which was given four weeks to treat and submit same within four weeks, said the aspect of the bill which treats host communities’ issues must be submitted before the four weeks expected for submission of the first one.

“I want to make observations on Senator Manager’s comments.

“Clearly what we have done here is really to make us to move forward in this important bill, to see that after so many years, we finally pass this petroleum industry bill.

“And that is why it has been put into different sections…”

“But I want to give a commitment on behalf of our colleagues that this one is just on the issue of governance. Before we proceed into the finalization of this part of the bill, the committee must come with a bill regarding the issue the host communities for discussion.

“And I think that that can be done within the next four weeks before we come back for consideration of clause by clause. We must bring the bill here on community issues and frontiers so that we can also pass it into second reading and commit it to the committee,” Saraki said.

The Senate President disclosed that the passage of the first leg of the bill was aimed at sending a message that the Red Chamber, under his watch was determined to finally pass the bill, which had previously suffered passage for onward presidential assent.

Hear him: “I think it would be fair to create an understanding that the purpose of this bill is to send the message that truly, as a Senate, we are committed in ensuring that we create that enabling environment for this sector.

“We can only do it in an environment of peace. So,  we will put it that while this bill is being referred to the Committees of Petroleum Upstream, Downstream and Gas, and being expected back in four weeks, we want to have the bill for the consideration of the issues of the oil bearing communities and also things like the fiscal issues before the four weeks time.”

He commended the patriotic zeal of senators to get the first bill to its current state, saying: “But more importantly, I want to commend the patriotism and the non partisan contributions of the senators of this Senate.

“You have again continue to show that on the issues of what matter to Nigerians or matter to the economy because, you would support. This is because we are talking about the economy of Nigeria, whether we like it or not, the issue of the Petroleum sector is key and we must make an enabling environment more efficient.”

Earlier, while making his contributions, Senator Manager frowned at the way and manner the Niger Delta region, which he noted, produces the nation’s oil  has been treated, saying while the discovery of oil in commercial quantity was a blessing to other parts of the country, it was a curse to its host region.

He said the injustice done so far to the region must be urgently addressed with the passage of the second leg of the bill that would recommend ten percent from oil revenue for the host communities.

“My respected colleagues, the oil bearing communities deserve 10 percent from the oil revenue.  It is on that that I stand,” he said.

Going further, he said: “My contributions as far as this bill is concerned, will be very limited. The PIB, as pointed out by Senator Barnabas Gemade, is one of the strongest bills in this Senate. I want to recall that it was first introduced between 2007 and 2011 Senate. It resurfaced between 2011 and 2015. Unfortunately, the bill did not see the light of the day, apparently because the bill carries so many segments and the interests are very divergent and because of that, the bill did not scale through.

“In fact, in one of the occasions, it scaled through second reading but never came back from the committee before the life span of that Senate ended. On this particular occasion, we have decided to separate or subdivide the bill into about five segments and this is one out of the five as is being presented by the Chairman, Senate Committee on Petroleum Upstream for debate for second reading.

“My respected colleagues, the discovery of oil in commercial quantities at a place called Oloibiri, in the present day Bayelsa State, has brought blessings to all Nigerians and blessings to all those who are not Nigerians but have been dealing with us from outside the country. But behold, this discovery of oil that has brought blessings to all of us is also a curse to the Niger Delta people. A very terrible curse to the Niger Delta people.

“You need to see things for yourself. A visit to Oloibiri, where oil was discovered in commercial quantities before the independence of this country in 1960 will tell the full story.

“The presentation of another bill or another law for the oil industry without taking together the interest of the oil bearing communities appears to be very very incomplete and very insincere. But I have been absolved and all of us have been absolved and by extension the Niger Delta people have been absolved that the next legislation of this all important bills would be the aspect that concerns the oil bearing communities.”

He, however, commended the first segment of the bill, saying the concluding part of the lead debate on the bill was not only slim but also focused and robust framework for effective institutional governance in the oil sector.

“Of course, my respected colleagues, the concluding part of the lead debate speaks volumes about what this bill is all about. That the bill possess a very slim, focused and yet robust framework for effective institutional governance of the Nigerian petroleum industry.

“That is what the concluding part of this bill is all about. But whether you like it or not, the objectives of this bill can only be achieved in a very peaceful environment, an environment that is peaceful and friendly, and that is the Niger Delta.

“I  speak with  a lot of passion because I am from the Niger Delta. In fact, beyond the boundary of my senatorial district, we have boundaries with the rest of the world. And therefore, when I speak about the oil bearing communities, I  speak with a lot of passion and a lot of ill feelings.

“Therefore, if the next batch of the debate or of the Petroleum Industry Bill is about the oil bearing communities, then I have no option than to support this bill.

“And if this is supported, I hope and pray that in the final analysis, whatever we do and whatever we say here, particularly laws that we make here are laws that must be implementable. And you can only implement the laws where there is peace and tranquillity.

Also contributing, Senator Barnabas Gemade said: “The separation therefore will bring about a very clear picture where a determined approach on how this matter can be dealt with on the basis of corporate best practice would be ensured.

“Even on this aspect alone, I believe that it is very timely indeed that we bring in a model of running the organisation within the petroleum industry that meets the international standards rather than this confused picture of joint venture business as defined by the JV agreements. With this few remarks, I support fully this motion, this bill and I urged my colleagues that we look at it dispassionately and pass it accordingly.”

Senator Jibrin Barau said: “First of all, let me say that this bill is long overdue. And I want to commend those who made it possible to get the bill to the stage it is now. The fact remains that all the petroleum producing countries that we know have robust efficient and effective legislations guarding the operations within the individual countries petroleum industries.

“And this has been to their advantage but Nigeria has become an exception and we have seen the adverse effects of lack of proper legislation to guide the petroleum industry in this country. Every investor wants to know what is happening legally within the environment it wants to invest.

“It wants to know the dos and donts, it wants to know the opportunities because you can calculate the opportunities, you can’t calculate the risk if you don’t know what is happening legally within a given system like what is obtainable in our petroleum industry as we speak. It is only that that an entity and investor will be able to calculate his risk and then begin to think of how to mitigate the risk.

“And that is why we are not having visitors coming to this country because of lack of a robust and an effective, efficient petroleum legislation. This is really commendable and we need to commend the Senate and the leadership for coming up with this bill.

And of particular interest and what I feel happy about is how the legislation has been divided into tranches to deal with all those areas where you you have less disagreement where we will have common ground and then moving to areas where we have interests here and there. And I am sure by the time we get there, we will be able to build consensus, give and take and then solve out this problem.

“I urge my colleagues that in the interest of this country at large and the petroleum industry in particular, to support this bill so that we can move the petroleum of this country forward.”

In his lead debate, Senator Alaosoadura, listed the objectives of the first leg of the five bills, to be treated within the lifespan of the 8th Senate, to include creation of effective institutions with clear and separate roles for the petroleum industry ;establishment of a framework for the creation of commercially oriented and profit driven petroleum entities that ensures value addition and compliance with international standards and promotion transparency; accountability in the administration of Petroleum resources of Nigeria and creation of a conducive business environment for the petroleum industry operations.

Ruling on the debate, Senate President, Bukola Saraki put a question: “Is there anybody that oppose any part of the bill?  But there was complete silence, meaning affirmation of the bill.”