Hopes that the Petroleum Industry Governance Bill (PIGB) would be passed before the tenure of this administration has been dashed as the Nigeria National Petroleum Corporation (NNPC) yesterday picked holes in the bill which is awaiting the assent of President Muhammadu Buhari. The harmonised version of the PIGB was sent to President Buhari for his signature on July 3, six weeks after the bill remained unsigned without any explanation from the Presidency.
However, the picking of holes in the bill by the NNPC yesterday could explain why the bill is still stuck in the Presidency.
Speaking at a conference organised by National Associate of Energy Correspondents of Nigeria in Lagos, yesterday Roland Ewubare, group general manager, National Petroleum Investment and Management Services (NAPIMs) faulted the bill sent to President Buhari for his signature.
Ewubare, who was representing Maikanti Baru, group general manager of the NNPC said that the proposal in the PIGB to split NNPC into two entities, if not properly communicated to staff of the corporation, is bound to generate tension between the unions.
He also said the issue of divestment of 40 percent of Nigeria Petroleum Company shares on the Nigerian Stock Exchange, needs clarity on the process of divestment and the steps should be clearly provided in the law.
The corporation wants to know if the shares are going to be sold to Nigerian public or foreign portfolio investors. This he says is not stated in the law.
There is no clarity regarding the nature of NNPC liability to be transferred to the Liability Management Company NPLMC, asides the outstanding pension obligations of the Department of Petroleum Resources (DPR). The bill, he says, does not provide adequate clarity on type and nature of liability to be inherited and the process for the settlement of such liability.
He said adequate clarity should be provided on funding of Nigeria Petroleum Assets Management Company (NPAMC) and the newly created NPLMC.
The NNPC boss advocated that the NPAMC should to be structured in the form of an agency rather than a company with limited role in the administration of production sharing contract assets. He said similar institutions across the world are structured as agencies.
He said that even though the PIGB has defined tenures for non-executive directors, there are currently no provisions that provides for stable tenures for the executive directors and insulate them from the changing dynamic of the political environment.
“The issuance of well-defined contract terms to the executive director may address this issue,” he said.
He said the newly established commercial entities are expected to be governed in line with the provisions of code of corporate governance by the security and exchange Commission. But the bill does not include recommendations to address possible conflicts that may arise between its provisions and those of the SEC code, where such conflict arise.
Olusola Bello
