By Andy Asemota
Nigeria’s global competitiveness as determined by capital investment inflow into the oil and gas industry shows a dismal less than five percent of the over 100 billion dollars inflow into Africa in the past 10 years.
The chairman of the Senate Joint Committee on Downstream Petroleum Sector; Petroleum Resources (Upstream); and Gas, Sen. Sabo Muhammad, made this disclosure on Thursday while presenting the committee’s report on the Bill for an Act to provide legal, governance, regulatory and fiscal framework for the Nigerian Petroleum Industry, the development of host communities and for related matters on the floor of the Senate.
Muhammad however expressed optimism that the bill, when passed into law, would attract and unlock the long-awaited capital investment inflows to the country’s oil and gas industry.
He said the final report prescribed amendments to a total of 752 provisions out of which about 56 are substantial amendments as recommended by the stakeholders and accepted by the joint committee.
“To ensure adequate development of the host communities and reduction of in the cost of production, the joint committee recommends five percent of the actual annual operating expenses of the preceding financial year in the upstream Petroleum operations affecting the host communities for funding of the Host Communities Trust Fund,” he disclosed.
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According to him, the committee also recommended a funding mechanism of 30% of NNPC Limited’s profit oil and gas profit as in the production sharing, profit sharing, risk service contracts to fund exploration of frontier basins.
He added: “The bill when passed into law will strengthen the accountability and transparency of NNPC LIMITED as a full-fledged CAMA company under statutory/regulatory oversight with better returns to its shareholders -the Nigerian people.”
Meanwhile, the consideration of the bill is still underway in the plenary of the Senate as at the time of this report on Thursday.
