Connect with us

Economy

PIB should formally address IOCs, host communities issues – MOMAN

Published

on

PIB should formally address IOCs, host communities issues – MOMAN

…As NNRC commends NASS efforts in passage of PIB***

The Major Oil Marketers Association of Nigeria (MOMAN) says the Petroleum Industry Bill (PIB) should formally address issues between International Oil Companies and their host communities.

Mr Tunji Oyebanji, Chairman, MOMAN highlighted this on Friday in Lagos, stressing the gesture would help to curb oil theft, pipeline vandalism and reduce the cost of crude oil production.

Oyebanji noted that the recent Public Hearing on the PIB, conducted by the National Assembly, was a step in the right direction.

He expressed optimism that the bill would soon be passed into law.

He said: “The PIB is looking at what the share of the host communities will be and if you make a law stating what will be provided for host communities, incidents of pipeline vandalism and oil theft will reduce.

“The PIB should formalise the relationship between the IOCs and host communities.

“Presently, what we find is that the oil companies, especially IOCs, are taxed with the petroleum profit tax and other royalties which are very substantial.

Also read:  Nigeria to get more oil revenue with PIB – Lawan

“So, when the host communities go and meet them for assistance, they will decline because they feel they are paying so much in royalties and taxes to the government.

“They expect the government to provide infrastructure such as schools and hospitals to these host communities.

“But the host communities will be confronting the companies because they are the ones on ground, carrying out production activities.’’

According to him, by the time the burden of taxes, royalties and taking care of the host communities are put on the IOCs, it will drive up the cost of oil production in the country.

“These are some of the things driving up the cost of production which makes it unattractive at the end of the day.

“So, the people who have choices and alternatives on where to go and invest their money will simply go to other countries to invest,’’ Oyebanji said.

He also said that there was a need for further engagement of all stakeholders in the industry.

MOMAN chairman noted that this would ensure that the PIB, when passed into law, would achieve its goals for the sector.

In a related development, the Nigeria National Resource Charter (NNRC) has however commended recent efforts by the National Assembly, toward ensuring the passage into law of the protracted Petroleum Industry Bill (PIB).

The NNRC, a non-profit policy institute that promotes effective management of natural resources for public good, made the commendation in a statement issued by its Programme Coordinator, Ms Tengi George-Ikoli on Friday in Lagos.

George-Ikoli said both the Senate and the House of Representatives had demonstrated commitment toward the passage of the PIB with the recently concluded public hearings.

According to her, there is need to ride the momentum and get all stakeholders on board to achieve what undoubtedly will be the most profound piece of legislation for the transformation of the Nigerian economy.

She noted that the NNRC had consistently highlighted the weaknesses in two significant aspects of resource management in Nigeria.

George-Ikoli said they were the contentious issues surrounding the management of host communities impacted by extraction and the management of the Nigerian National Oil Corporation (NNPC).

“The NNRC urges the Federal Government to finally resolve the pervasive issues facing the petroleum sector.

”The  Federal Government is encouraged to do this to ensure that Nigeria will be able to meet global best practices and also to effectively ‘identify, explore, account for, mitigate or compensate for the negative effects of extraction at all stages of the project cycle,” she said.

George-Ikoli said this would enable the country to run a National Oil Company (NOC) that was effective, accountable, with well-defined mandates and an objective of commercial efficiency.

She also urged the government to prepare for the future by earnestly refocusing the country’s energy policies to accommodate present realities with emerging developments in global energy consumption.

The programme coordinator noted that the NNRC had made key submissions in its memoranda to the national assembly advocating that the PIB provided clarity on capitalisation of the NNPC.

She said this would enable the corporation to adapt a commercially focused framework that allowed it operate in a competitive space.

According to her, the NNPC should explore the possibility of an Initial Public Offering (IPO) with more private sector and possible citizen participation as practised in other countries.

George-Ikoli said this would also allow for meaningful participation of host communities in decision making in managing trust, at the Board of Trustees and Management Committee, to engender conducive operating environment.

She said: “The PIB should ensure mechanisms for dispute resolution are accommodated to address conflicts that may arise in the determination of host community entitlements.

“It should liberalise the midstream and incentivise gas investments by not legislating the base gas price, but instead,  allowing it be determined by the practical framework that considers cost of production and pipeline transportation.”

 

Economy

FAAC: FG, States, LGs Share N1.208trn Revenue For April

Published

on

FAAC: FG, States, LGs Share N1.208trn Revenue For April

The Federation Account Allocation Committee (FAAC), has shared the sum of N1.208 trillion as revenue for April among the Federal Government, states and Local Government Councils (LGCs).

The revenue was shared on Thursday at the May meeting of FAAC in Abuja.

A communiqué issued by the committee said that the N1.208 trillion total distributable revenue comprised statutory revenue of N284.716 billion, and Value Added Tax (VAT) revenue of N466.457 billion.

It also comprised Electronic Money Transfer Levy (EMTL) revenue of N18.024 billion, and Exchange Difference revenue of N438.884 billion.

The communique said the total revenue of N2.192 billion was available in April.

“Total deduction for cost of collection is N80.517 billion; total transfers, interventions and refunds is N903.479 billion.

The communique said the Gross statutory revenue of N1.233 billion was received for the month under review. This was higher than the sum of N1.017 billion received in March by N216.282 billion,” it said.

It said that the gross revenue available from VAT in April was N500.920 billion, which is lower than the N549.698 billion available in March by N48.778 billion.

The communiqué said that from the N1.208 trillion total distributable revenue, the Federal Government received N390.412 billion, the state governments received N403.403 billion and the LGCs received N293.816 billion.

“A total sum of N120.450 billion (13 per cent of mineral revenue) was shared to the benefiting states as derivation revenue,” it said.

It said that on the N284.716 billion distributable statutory revenue, the Federal Government received N112.148 billion, the state governments received N56.883 billion and the LGCs received N43.855 billion.

It said that the sum of N71.830 billion (13 per cent of mineral revenue) was shared to the benefiting states as derivation revenue.

“The Federal Government received N69.969 billion, the state governments received N233.229 billion and the LGCs received N163.260 billion from the N466.457 billion distributable VAT revenue.

“A total sum of N2.704 billion was received by the Federal Government from the N18.024 billion EMTL, the state governments received N9.012 billion and the LGCs received N6.308 billion.

“The Federal Government received N205.591 billion from the N438.884 billion Exchange Difference revenue; the state governments received N104.279 billion, and the LGCs received N80.394 billion.

“The sum of N48.620 billion (13 per cent of mineral revenue) was shared to the benefiting states as derivation revenue,” it said.

According to the communiqué, Oil and Gas Royalties, Companies Income Tax (CIT), Excise Duty, Petroleum Profit Tax (PPT), EMTL and CET Levies increased significantly.

It, however, said that Import Duty and VAT recorded considerable decreases.

“The balance in the ECA was 473.754 million dollars.

Continue Reading

Economy

Extension Of Nigeria’s Continental Shelf As Lesson On Continuity

Published

on

Extension Of Nigeria’s Continental Shelf As Lesson On Continuity

On May 14, the High Powered-Presidential Committee on Nigeria’s Extended Continental Shelf Project was in the Presidential Villa, Abuja.

The committee came to brief President Bola Tinubu on recommendations given to Nigeria regarding its submission for an extended continental shelf by the United Nations Commission on the Limits of the Continental Shelf (CLCS).

The briefing was led by veteran diplomat, Amb. Hassan Tukur, the Chairman of the committee.

The update with the president featured technical presentations by Prof. Larry Awosika, a renowned marine scientist and Mr Aliyu Omar, Member/Secretary of the Committee and former staff of the National Boundary Commission (NBC).

Omar also served as the Desk Officer for the project office in New York for several years.

Worthy of note, Nigeria’s request to have it continental shelf extended was approved by the CLCS in August 2023.

The project, which aims to extend Nigeria’s maritime boundaries under the United Nations Convention on the Law of the Sea (UNCLOS), has granted Nigeria sovereignty over an additional 16,300 square kilometres of maritime territory.

This is roughly five times the size of Lagos State.

The CLCS is mandated to, inter alia, consider the data and information submitted and provide recommendations on the outer limits submitted by the coastal state.

Article 76 of UNCLOS (1982) allows a qualifying coastal state to extend its continental shelf up to a maximum of 350M (350 nautical miles) or 150m nautical miles beyond its traditional Exclusive Economic Zone of 200 nautical miles.

Extension Of Nigeria’s Continental Shelf As Lesson On Continuity
President Bola Tinubu receiving Nigeria’s CLCS report from the committee

The continental shelf is the natural submerged prolongation of its land territory.

The journey to extend Nigeria’s continental shelf project began in 2009 with the country’s submission to the CLCS.

The project faced delays due to a lack of funds and administrative challenges; in 2013 the Senate of the Federal Republic in its resolution of Feb. 14, 2013, urged the Federal Government to fund the project and set up an independent body to handle it.

However, it was only in November 2015 that the then President Muhammadu Buhari revitalised it.

Subsequently, he appointed the High-Powered Presidential Committee (HPPC), headed by the former Minister of Justice and Attorney-General of the Federation, Malam Abubakar Malami, to oversee the project.

The HPPC operated as an independent technical body, effectively managing the project by cutting down on government bureaucracy.

Omar had led the Nigerian Technical Team through the question-and-answer sessions with the UN Commission on the Limits of the Continental Shelf (CLCS).

He was also the Member/Secretary of the HPPC with a strong institutional memory of the project, highlighted this during the committee’s briefing to President Tinubu on May 14.

Omar said that when the HPPC briefed Buhari in 2022 on the status of the project, the United Nations Commission on the Limits of the Continental Shelf (CLCS) was still considering Nigeria’s submission and having technical interactions with the HPPC.

”These interactions and consideration have now culminated in the approval for Nigeria to extend its continental shelf beyond 200M (200 nautical miles).

”As it stands now, the area approved for Nigeria is about 16,300 square kilometres, which is about five times the size of Lagos State”, he said.

Nigeria’s extended continental shelf is in an area that is referred to as the ‘Golden Triangle of the Gulf of Guinea’ due to its abundance of natural resources such as hydrocarbons, natural gas, and a variety of solid minerals.

Awosika, a pioneer member and former Chairman of the CLCS, explained that the technical team’s work involved lengthy processes.

He said it also required highly technical steps in the acquisition, processing and analysis of extensive marine scientific data offshore Nigeria’s margin for the submission to the UN CLCS.

He said that the Nigerian team had to defend the submission with the CLCS which involved highly technical question-and-answer sessions and provision of additional data and information.

Receiving the report, Tinubu commended the members of the technical team for working tirelessly.

He applauded their high technical and scientific expertise and solidarity to national cause throughout the eight years of service to the nation before an agreement was finally reached with the UN CLCS in August 2023.

It is instructive to note that Tinubu highlighted the interactions he had with his predecessor, Buhari, on the project; given that it was he, Buhari, who set up the HPPC to oversee the project in 2015.

Tinubu recounted how Buhari briefed him on the importance of the project.

”This is a big congratulations for Nigeria. I commend the team and we must take advantage of this and invite you again to have a repeat of this knowledge exploration on geography, hydrography and marine life.

”Nigeria is grateful for the efforts that you put into gaining additional territory for the country without going to war; some nations went to war; and lost people and economic opportunities.

”We lost nothing but have gained great benefits for Nigeria; we will pursue the best option for the country,” Tinubu said.

Tinubu has also promised to ‘pursue the best option for the country’ on the project, even though the CLCS recommendations fall short of Nigeria’s submitted claim.

Perceptive observers say the achievement is a lesson on the importance of continuity in government projects. Abandoning projects due to changes in administration can lead to wasted resources and lost opportunities.

The extended continental shelf is a significant achievement of Tinubu’s administration and to Nigeria.

According to experts, this is something that has never happened in the nation’s history, and may never happen again.

By learning from the ECS project, Nigeria can improve its approach to governance and project management, ensuring that with perseverance and continuity strategic initiatives are completed despite challenges.

The ECS project, initiated in 2009, faced delays and funding issues but persistence through the efforts of the immediate past administration paid off, and was finally approved by the UN in August 2023, shortly after Tinubu assumed office.

The country has taken note of articles 7 and 8 in Annex II to the Convention on the Law of the Sea concerning recommendations received from the CLCS.

The project also demonstrates the importance of long-term thinking in governance.

Discerning stakeholders hold that while the project’s benefits may not be immediate, it will surely have a significant impact on Nigeria’s economy and maritime boundaries in the future.

Continue Reading

Economy

Naira Gains N61.38 Against Dollar At Official Market

Published

on

Naira Gains N61.38 Against Dollar At Official Market

The Naira on Wednesday appreciated at the official market, trading at N1,459.02 to the dollar.

Data from the official trading platform of the FMDQ Exchange revealed that the Naira gained N61.38.

This represents a 4.04 per cent gain when compared to the previous trading date on Tuesday, when the local currency exchanged at N1,520.40 to a dollar.

Also, the total daily turnover increased to 289.14 million dollars on Wednesday up from 128.76 million dollars recorded on Tuesday.

Meanwhile, at the Investor’s and Exporter’s (I&E) window, the Naira traded between N1,593 and N1,401 against the dollar. 

Continue Reading

Advertisement

Editor’s Pick

Politics