10% Revenue Retention By PRC Reason Buhari Vetoed PIGB, Presidency Claims

President Muhammadu Buhari

The Presidency Wednesday claimed that the provision of the Petroleum Industry Governance Bill (PIGB) 2018 which permits the Petroleum Regulatory Commission (PRC) to retain as much as 10percent of generated revenue was real reason President Muhammadu Buhari refused assent to the bill.

The PIGB was presented to the president last month, after being passed by parliament in March. The bill seeks to, among others, unbundle the NNPC and create a single-entity regulator the national petroleum regulatory commission.

The bill is intended to transform the governance of the upstream, midstream and downstream sectors of the Nigerian petroleum industry, and position nation to compete favourably in the global oil industry.

Online newspaper, the Cable, had earlier reported that the President withheld assent to the bill because it would whittle down his powers as minister of petroleum resources.

However, in an email attempting to clarify the executive’s position, Senator Ita  Enang, Presidential Liaison to the National Assembly-Senate, claimed the 10percent of generated revenue to be retained by the PRC unduly increases the funds accruing to the Commission to the detriment of the revenue available to the Federal, States, Federal capital Territory and Local governments in the country, hence the non-assent.

In the emailed statement which was made available to e360, Enang added that “Expanding the scope of Petroleum Equalisation Fund (PEF) and some provisions in divergence from this administration’s policy and indeed conflicting provisions on independent petroleum equalisation fund,” was another issue that didn’t sit well with the President.

“Some legislative drafting concerns which, if assented to in the form presented will create ambiguity and conflict in interpretation,” were also reasons the president refused to sign the bill according to Enang.

e360 learnt that the Senate had since 29, July, been communicated about the presidents decline of assent to the PIGB.

Shocked by the development, Industry watchers and stakeholders had expressed optimism about assent to the bill because it is expected to breath a new lease of life into the presently stagnated oil sector.

Wumi Iledare, a professor of petroleum economics and policy research, exclusively told e360 that an assent to the bill would take away the uncertainty that has plagued the sector for long.

“If we pass this (PIGB) alone, to start with, it shows that Nigeria is now serious because the bill is about accountability and transparency. Accountability in the sense that you know the agency to hold responsible for what. Once it becomes law, there will be more clarity in the industry… and it will lead to making us more attractive to investors,” he said

In his assessment , Prof. Iledare who is the director of Energy Information Division for the Centre for Energy Studies. said the bill as drafted, will allow the preservation of the common wealth for the benefit of Nigerians. “If you look at the whole draft, you will find out that the essence of this bill is to make the creation of wealth to be expanded. It is about expanding the base so that much more people can become a beneficiary of Nigeria’s petroleum resources.”

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