My response below the article
Democracy in Action
Dr. Levi Ajuonuma, 08.01.2009
I am writing on the just-concluded public hearing on the Petroleum Industry Bill (PIB) for many reasons, chief among which is that the Nigerian National Petroleum Corporation (NNPC) where I currently work is a major stakeholder in any issue dealing with oil and gas exploration in Nigeria. The NNPC, along with the other parastatals under the supervision of the Ministry of Petroleum Resources, feels very strong that this review of laws governing the management of our nation’s hydro-carbon resources is long over due. As soon as President Umaru Musa Yar’Adua submitted a Bill backing up the much needed reforms in the oil and gas industry, the Oil and Gas Implementation Committee (OGIC) went into action putting together an inter-agency memorandum on the Bill as submitted by the President.The group comprised of senior management executives from Federal Inland Revenue Service (FIRS), Nigerian Extractive Industry Transparency Initiative (NEITI), Department of Petroleum Resources (DPR) and NNPC. Their mission was, of course, to focus and prepare an industry memorandum to the bill. Some in the industry got wind of the work of the Inter-agency Committee and because they knew the calibre of persons involved they felt that whatever the Inter-agency would come up with was the Bill. The International Oil Companies (IOCs), who have operated under this outdated laws in Nigeria, employed every tactic in the book to decode what the inter-agency team was putting together. They knew that members of the group were their counterparts in the industry with strong loyalty to Nigeria and hated the undue perennial exploitation of our hydro-carbon properties by the IOCs.These companies were our partners in this business, but all of us knew very well that they were getting away with so much in Nigeria because of our outdated laws. How else would one explain the acreage issue where one company would hold on to huge expanse of oil reserves/wells which can produce oil for Nigeria but which the existing laws allow them to hold onto until they are ready to produce from it? Marginal field operators in the industry will tell you that Nigeria will make more revenue if the IOCs could relinquish unexploited acreages. Other free rides which the IOCs have enjoyed in the last 50 years range from payment of low taxes and royalties, maltreatment of host communities, lack of attention to local content via the penchant for developing their homeland economies by taking jobs that could be done here in Nigeria to overseas location for execution. Has anybody ever wondered why after 50 years of oil and gas exploration, the impact of the annual industry spend of close to $10 billion is not felt as it should be within the Nigerian economy? The IOCs would like nothing but business as usual. No wonder they oppose the PIB. However, as the old saying goes, you can fool some of the people some of the time, you can also fool all of the people some of the time, but you can never fool all of the people all of the time. Luckily, it is time for Nigeria to be wise. No wonder the Bill attracted such a huge attention both at home and abroad. Senate President David Mark captured the scenario when he remarked that in his 10 years in the Senate no Bill has attracted the attention and turn out of Nigerians as was witnessed in the public hearing at the National Assembly.In a nutshell, this PIB is really about providing a legal framework that will back up the ongoing reforms in the industry. It is geared towards merging 16 existing but obsolete laws into one workable legislation. The Bill therefore is a watershed, revolutionary and all encompassing. Yet it is designed to empower the Nigerian state and her people. The PIB hopes to encourage the development of small fields by deliberately allowing for low tax incentives having a bottom level royalty scale of 5 per cent based on daily oil production. The idea is to encourage Nigerian entrepreneurs to partake in the oil and gas business. It goes without saying that no well-meaning Nigerian should apologise to any body for the innovative approach of the President to jump start an industry that is 30 years behind its peers.The views expressed during the public hearing were as varied as they were interesting. It was really democracy at work. Everyone who had any thing to say was given an opportunity to do so. In my assessment, the area that received the most opposition was not a surprise. As expected, the IOCs did not want to pay higher taxes and royalties. They wanted more time to implement the reforms. They were not ready for the proposed Incorporated Joint Venture, IJV, concept. For the ethnic nationalities, they canvassed for more powers for the host communities in terms of appointment into all new agencies proposed under the Bill. They wanted more revenues, more infrastructure and environmental protection for their communities. Some of them thought that the Bill should even redress the issue of derivation which, unfortunately, is a purely constitutional matter. The Inter-agency memorandum on this Bill did address some, if not all, of these issues in a very professional manner. It is the hope of all of us that our lawmakers will sieve through these opinions and come up with a law that will seek greater benefit for the Nigerian state and for her hydrocarbon endowment. Those who stayed away from the public hearings missed a huge and important democratic dividend. Some of these people chose to stay away because of deliberate misinformation orchestrated by their leaders.
•Dr. Ajuonuma is the Group General Manager Public Affairs of the NNPC
Dear Levi Ajunoma,like you have succintly commented,you can not fool everybody all of the time. Nigerians know the problem is not with foreigners,but with Nigerians themselves,afterall,the current 'defective' laws were put in place by . . . you guessed right-Nigerians. NNPC has and will continue to be the greatest stumbling block in this regard. Can any of the senior managers and directors(including Dr Levi himself)claim not to have enjoyed the status quo? How many properties does Dr Levi have home and abroad? So please spare us your phony outrage. You are all culpable. Thats why almost all Nigerians doubt the sincerity of the current efforts,its simply one set of thieves trying to take advantage of the another.
Solution: Scrap the NNPC,give the states full control of their resources,set up an appropriate federal tax system to enable the royalties go around. . that is all !
All the stories you are coming up with simply do not hold water :no: . QED
