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Key players in Nigeria’s oil and gas industry have called for an urgent review of the Petroleum Industry Act (PIA), citing outdated provisions that fail to align with global trends, evolving technology, and current industry challenges.
They made this known at a panel session titled “Oil & Gas in Transition – Reforms, Recovery, and Deals That Matter” at BusinessDay’s CEO Forum on Thursday.
The leading executives from indigenous oil firms highlighted several recommendations aimed at ensuring that the landmark legislation delivers on its promise of transforming Nigeria’s energy sector.
Tony Attah, CEO of Renaissance Africa Energy, stated that while the passage of the PIA after two decades of delay was commendable, the Act had become “outdated on arrival.”
He stressed the need for a comprehensive review that considers recent technological advancements, including artificial intelligence (AI), digitalisation, and the energy transition.
The Petroleum Industry Act (PIA) 2021 was signed into law by the former President of Nigeria, Muhammadu Buhari, on August 16, 2021.
Read also: Nigeria rallies investors as reforms gain traction
This act is a significant piece of legislation aimed at reforming Nigeria’s oil and gas industry. It replaces the older Petroleum Act of 1969 and introduces a new legal, governance, regulatory, and fiscal framework.
The PIA aims to modernise the industry, attract investment, and promote sustainable development.
“The Act doesn’t take cognisance of digitalisation, and it doesn’t recognise AI. In today’s world, you can’t survive without AI,” Attah said. “We need to revise the PIA to reflect current realities.”
Panellists also highlighted regulatory bottlenecks that have hindered investment and operational agility.
Attah welcomed the recent Executive Order that raised the contract approval threshold from $500,000 to $10 million, describing it as a “game-changer” for industry flexibility. However, he maintained that such reforms must be codified and harmonised within the PIA framework.
“For 30 years, our industry was stifled by the inability to execute contracts above $500,000 without regulatory approval in a multi-billion dollar sector,” Attah said.
Another major recommendation was the urgent need for the PIA to provide clear guidelines on securing oil and gas infrastructure, particularly pipelines.
Attah stressed that the challenge was no longer just about producing hydrocarbons but ensuring they reach the point of sale, which is often hampered by vandalism and theft.
Adegbite Falade, MD/CEO of Aradel Holdings Plc, praised the recent cost-reduction incentive framework but urged a more refined approach in future legislative updates.
He noted that the current system does not differentiate between operators who exceed targets and those who merely meet them, thereby failing to reward efficiency and performance.
“We need a framework that promotes both cost efficiency and capital efficiency while recognising differences in operator performance and field conditions,” he said. “It should also integrate environmental metrics to encourage sustainable operations.”
