For the nation to reap the full benefits inherent in the newly signed Petroleum Industry Act (PIA), the Lagos Chamber of Commerce and Industry (LCCI), has urged the federal government to pay attention to the implementation of the provisions in the Act.
LCCI, in a statement signed by its Director General, Dr. Chinyere Almona, in Lagos on Thursday, said PIA provides a robust legal framework that will support the reforms required to position the nation’s oil and gas industry as an investment haven that attracts investors from across the globe.
Almona noted that there is a need to create more understanding through public enlightenment about the three percent revenue allocation to host communities to forestall a misunderstanding of the Government’s intentions and raise tensions in the oil-producing region.
“Beyond the enlightenment, there should also be a monitoring mechanism to ensure that the allocated funds are judiciously used for the development of the host communities. Government should be firm and clear in their communications about the removal of oil subsidies or otherwise. Policy statements influence business decisions. The divergent statements by different government officials on the removal of oil subsidies create uncertainty. This is unhealthy and not standard practice for a sector that hosts billions of dollars of investment”
“The unbundling of the Nigerian National Petroleum Corporation (NNPC) should be done in such a way that it does not create unnecessary bottlenecks and bureaucracy in contract administration and project management in the oil and gas industry. The emerging companies should be run in line with the Companies and Allied Matters Act (CAMA) and the Code of Corporate Governance.
She noted that there should be a level playing ground in the deregulation of the downstream as provided in the PIA where market forces are allowed to allocate resources through cost-reflective pricing.
“We however urge the Government to engage with all relevant stakeholders and players in the sector to arrive at an inclusive deregulation policy that creates a competitive business environment where all investors can thrive.The Act should be implemented with a focus on the areas of business regulations that make up the indicators of the Ease of Doing Business Ranking by the World Bank. Particularly, we need to do better with enforcing contracts within the oil and gas industry”.
Almona, however, hails President Mohammadu Buhari for signing the bill into law, adding that the new law has put an end to the decades of uncertainties concerning the future of the oil and gas industry in Nigeria.
“With the emergence of a more structured industry, it offers a level playing ground that can attract massive Foreign Direct Investments (FDIs) into the country. This Act will also promote more competition that could bring about a more efficient system, more product choices, and lower prices in the long term.
“We wish to urge the Presidency, Ministry of Petroleum Resources, and other institutions responsible for the implementation of this new law, to put in place a robust mechanism and roadmap, with due consultation with private sector operators and other stakeholders to drive effective and efficient implementation”.