highlights of aspects of the petroleum industry bill a presentation to the nigerian association of...
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This paper presented at the Nigerina Association of Energy Economics conference highlights the upstream aspects of the Petroleum Industry BillTRANSCRIPT
Highlights of Aspects the Petroleum Industry Bill
Dr. Adeoye AdefuluOdujinrin & Adefulu
Barristers Solicitors & Notaries PublicBarristers, Solicitors & Notaries PublicLagos – Abuja – Port‐Harcourt
OutlineOutline
• Background
• NNPC Ltd.NNPC Ltd.
• IJVs
• Upstream Licensing
• Environmental mattersEnvironmental matters
• Institutional Framework
Odujinrin & Adefuluestd. 1972
BackgroundBackground
– Thrust of the reform is to:• Clearly separate the government functions in the oil industry – policy, regulatory and commercial
• Create a stronger National Oil Company modeled after St t il P t t ith i d d t i tStatoil, Petronas etc with more independence to invest in local production as well as foreign markets
Odujinrin & Adefuluestd. 1972
NNPC Ltd.NNPC Ltd.
• NNPC to be corporatised– All assets and liabilities of NNPC to be transferred (s.137)
• Except PSC assetsExcept PSC assets
– How will it be funded?• Certain moneys to be retained by the government• Certain moneys to be retained by the government under law‐ would it apply?
Odujinrin & Adefuluestd. 1972
IJVIJV
• Should they be created by negotiation or legislation?g
• No provisions as to transfer of assets & liabilitiesliabilities– Stamp duties issues
– How will the assets be held?
– Will transfer of OMLs require ministerial consent?q
– Will JV companies be able to book assets
Odujinrin & Adefuluestd. 1972
LicensingLicensing
• Sections 4 & 257 empowers minister to grant licenses– PPL & PML
• May only be granted to indigenous oil• May only be granted to indigenous oil companies– Not less than 60% shareholding by Nigerians
– Must be ratified by the Inspectorate or Directoratey p
Odujinrin & Adefuluestd. 1972
Licensing (contd.)Licensing (contd.)
• Minister grants licenses on the recommendation of NPD
• NPD to conduct licensing roundsN di ti d– No more discretionary awards
– No explicit link between power of the Minister to award licences and NPD bid rounds
Odujinrin & Adefuluestd. 1972
Environmental MattersEnvironmental Matters
• Requirement to conduct environmental programmes or environmental quality p g q ymanagement programmes– No distinction between the two– No distinction between the two
• This appears to be in addition to the EIA requirements
• EP/EQMP regime under Inspectorate while EIAEP/EQMP regime under Inspectorate while EIA regime under Ministry of Environment/NESREA
Odujinrin & Adefuluestd. 1972
Environment/NESREA
Institutional FrameworkInstitutional Framework
• Creation of NPD, NPI, NAPAMA amongst others
• Regulatory functions not fully separatedS l f t f ti t b i d t– Several references to functions to be carried out by NPD or NPI
– Should a policy body hold acreage?• PSC
• Is there a need for NAPAMA
Odujinrin & Adefuluestd. 1972
Questions?Questions?
Dr Adeoye Adefulu
[email protected] & Adefulu
Barristers, Solicitors & Notaries Public
Lagos – Abuja – Port‐Harcourt
Odujinrin & Adefuluestd. 1972