A joint investigative hearing by the two chambers of the National Assembly on President Bola Tinubu’s Executive Order mandating the direct remittance of oil and gas revenues to the Federation Account was stalled on Thursday after the Minister of State for Petroleum Resources, Heineken Lokpobiri, requested more time to prepare his defence.
The hearing was jointly organised by the Senate and House of Representatives Committees on Petroleum Resources and Gas.
|
|
The lawmakers had convened the session to seek explanations on the president’s executive order concerning oil revenues and its implications for Nigeria’s petroleum industry.
Others in attendance, aside from Mr Lokpobiri, were the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), Bayo Ojulari, and the Chief Executive Officer of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Oritsemeyiwa Eyesan.
|
|
|
|---|
However, minutes into the session, Mr Lokpobiri, a former senator, appealed to the lawmakers for more time to study relevant documents, stating that he and his team had not yet obtained the necessary materials to adequately defend the president’s action.
He said he was only informed of the hearing a day earlier, but still chose to attend out of respect for the parliament.
The minister consequently requested that the hearing be rescheduled to allow him and his team sufficient time to prepare.
The Co-Chairman of the joint committee, Agom Jarigbe (APC, Cross River North), who chairs the Senate Committee on Gas, put the request to a voice vote, and the majority of lawmakers supported it.
Mr Jarigbe then told Mr Lokpobiri that the committee would communicate a new date for the minister’s reappearance.
Earlier, at a separate meeting, the Chairman of the Senate Committee on Finance, Sani Musa, disclosed that President Tinubu would soon transmit proposals to the National Assembly seeking amendments to certain provisions of the Petroleum Industry Act (PIA) to reflect current economic realities.
He noted that although many assumed the executive order would automatically boost government revenue, this might not necessarily be the case, as Nigeria has yet to attain its desired revenue levels.
The senator noted that the drive to enhance revenue generation through the executive order would prompt the president to propose the necessary amendments to the Petroleum Industry Act.
However, Mr Musa did not specify the exact provisions of the law that would be affected by the proposed amendment.
The Executive Order
On Wednesday, Mr Tinubu signed an Executive Order directing that royalty oil, tax oil, profit oil, profit gas, and other revenues due to the Federation under production-sharing, profit-sharing, and risk-service contracts be paid directly into the Federation Account.
The order also scrapped the 30 per cent Frontier Exploration Fund established under the PIA and discontinued the 30 per cent management fee on profit oil and profit gas retained by the Nigerian National Petroleum Company Limited (NNPCL).
Anchoring the directive on Sections 5 and 44(3) of the 1999 Constitution (as amended), the presidency said the move was aimed at safeguarding oil and gas revenues, curbing what it described as excessive deductions and restoring the constitutional entitlements of federal, state and local governments to the Federation Account.
However, the decision has generated criticism from some stakeholders in the oil and gas sector. The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) on Thursday rejected the order, describing it as a dangerous precedent that could undermine the PIA and erode investor confidence.
The association’s president, Festus Osifo, said at a press briefing that the association was troubled by the development and called for the immediate withdrawal of the directive.
The PIA, signed into law in 2021, was to comprehensively reform Nigeria’s oil and gas sector. It was enacted to reform the governance, regulatory, and fiscal structure of the sector after nearly two decades of stalled petroleum reform efforts.
The law provides for the commercialisation of the NNPCL into a limited liability company, establishes new regulatory bodies for upstream and midstream/downstream operations, restructures revenue-sharing arrangements, and introduces host community development provisions.
Discover more from Premium Times Nigeria
Subscribe to get the latest posts sent to your email.
