The President of Nigeria, Muhammadu Buhari has approved the Petroleum Industry Bill (PIB).
The president signed the PIB bill into law after it was recently passed by the National Assembly.
This was confirmed in a statement on Monday by his spokesperson, Femi Adesina.
What is Nigeria’s Petroleum Industry Bill and why is it significant?
Crude oil dominates Nigeria’s economy, accounting for around 90% of export earnings. The country has the largest oil and gas reserves in sub-Saharan Africa with an estimated 37bn barrels of oil and 188 trillion cubic feet of gas. Yet for decades, the virtually ungovernable industry has been plagued by poor leadership, eye-watering corruption and environmental degradation.
Value has leached away through opaque licensing deals, unaccountable middlemen, a lack of refining capacity and graft in the government and state-owned Nigerian National Petroleum Corporation (NNPC). Sabotage and pipeline theft in the oil-rich Niger Delta have ensured that the taxpayer loses out on billions of dollars in annual revenues.
Nigerian administrations since the 1960s have – with varying degrees of effort – failed at reform. In the last 20 years, multiple governments have attempted to pass an all-encompassing Petroleum Industry Bill (PIB), the scope and complexity of which has ensured repeated failure.
What changes under the new bill?
The bill lays down rules for environmental cleanups, introduces new dispute-resolution mechanisms between government and oil companies, and sets up a midstream government infrastructure fund
“It would play a vital role in addressing the inefficiencies plaguing the NNPC, from slow approval for oil projects to budget shortfalls that hinder its ability to pursue public-private partnerships. What’s more, the bill would create a supportive environment for both IOCs and indigenous petroleum companies, help protect the environment and the interests of host communities, support economic diversification in Nigeria, and critically important, promote transparency in Nigeria’s administration of petroleum resources,” wrote NJ Ayuk, executive chairman of the African Energy Chamber, in October.
Read the official statement below:
PRESIDENT BUHARI SIGNS PETROLEUM INDUSTRY BILL INTO LAW
President Muhammadu Buhari has signed the Petroleum Industry Bill 2021 into law.
Working from home in five days quarantine as required by the Presidential Steering Committee on COVID-19 after returning from London on Friday, August 13, the President assented to the Bill Monday, August 16, in his determination to fulfill his constitutional duty.
The ceremonial part of the new legislation will be done on Wednesday, after the days of mandatory isolation would have been fulfilled.
The Petroleum Industry Act provides a legal, governance, regulatory and fiscal framework for the Nigerian petroleum industry, the development of host communities, and related matters.
The Senate had passed the Bill on July 15, 2021, while the House of Representatives did the same on July 16, thus ending a long wait since the early 2000s, and notching another high for the Buhari administration.
Femi Adesina
Special Adviser to the President
(Media and Publicity)
August 16, 2021
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