The Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed in a policy brief that Nigeria loses $200 billion yearly due to the non-passage of the Petroleum Industry Bill (PIB).
The brief also alerted the nation to the fact that another $15 billion is lost yearly in fresh investments to regulatory uncertainties.
With Nigeria in recession, NEITI urged President Muhammadu Buhari to take the lead and infuse urgency into the passage of the PIB as part of measures to ensure the country overcome the economic challenges.
The policy brief entitled “The urgency of a new petroleum sector law,” noted that the process of enacting a new law for Nigeria’s petroleum sector has gone on for far too long, and at an enormous cost to the country. It seeks more urgency and better coordination in getting the important bill passed.
NEITI maintained that the PIB is one of the most important bills ever to be contemplated in Nigeria’s history, yet the one that has taken the most time and generated the most activity without legislation.
NEITI stated that as an agency set up to enthrone transparency and accountability in the extractive industries, it has legitimate interest in a petroleum law for the country.
It observed that the setbacks suffered by the bill were not due to the poor understanding of the problems or the deficiency in expert input, but largely due to disagreements among stakeholders on the “regulatory frameworks, including power of the minister, ownership and control of the resources, host community benefits, environmental concerns and appropriate fiscal regime, and in the process, every administration has produced its own PIB draft(s), but not the law.”
The brief recommended that an inclusive task team should be urgently empanelled, with the president in the lead, and charged with building consensus among stakeholders.
According to NEITI, clear, unambiguous rules, predictable policy-making and efficient regulations have been lacking in Nigeria’s petroleum sector since the process of enacting a law for the industry commenced.
It says its 2013 audit of the oil and gas sector revealed that $10.4 billion and N378.7 billion (N3.2 trillion at the current exchange rate) were lost as a result of under-remittance, underpayments, inefficiencies, theft or absence of clear fiscal regime in Nigeria’s oil and gas sector.
The agency further stated that the losses in economic terms have equally been huge; the hemorrhage on Nigeria’s foreign reserves and value of the naira due to imports of over $26.4 billion worth of refined petroleum products that should otherwise have been done locally and loss of jobs in their hundreds of thousands by Nigerians.
While NEITI acknowledges the plurality of action on the petroleum sector law, it noted that there is no evidence that Nigeria has learnt from its past experiences to guarantee that the present journey will be any different.