NANFeatures/Vol.10/No.265/2016 (Dec. 6)
What are stakeholders’ expectations in the proposed oil policy?
A News Analysis by Yetunde Bada, News Agency of Nigeria (NAN)
Stakeholders in oil and gas sector solicit transparency and investor-friendly policies that can enhance the sector and clean up the rot in it.
At a recent stakeholder consultation on draft National Gas Policy and National Oil Policy recently in Abuja, Mr Gbite Adeniji, Special Technical Assistant to the Minister of Petroleum Resources, said the policy — presented in 2006 — would address future operations in the sector.
According to him, transparency and reducing duplications of functions are key features of the policy.
He told the stakeholders to look at the proposal around thematic issues, make comments and observations and see how the comments could be built into the proposal after its presentation to the Federal Executive Council.
“There should be transparency of regulation policy, contracts procurement and license awards and renewal.
“There is a need to be investor-friendly and recognise there’s boundary to responsible behaviour by government.
“We can’t propose legislation without policy, the policy comes first and then the legislation follows. There must also be a clear recognition of the need to attract private capital.
“Its about planning and planning together, both government and industry will chart a new way, all seeking the same objective,’’ Adeniji said.
He advised that in the downstream sector, the short term objective could be to produce fuels and petro-chemicals that were competitive against imports.
He also said the longer term objective could be to be competitive as an exporter of the products.
Proffering solutions to how the private sector could be supported, Adeniji said there must be “encouragement for investments in new refineries and introduction of competition through liberalisation.
“For global competitiveness, encourage integrated oil and petrochemical complexes rather than sizing to local demand.
“Kerosene subsidies should end because it only benefits black marketers and so that the poor won’t suffer’’.
On the issue of oilfield security, Adeniji said it was time for the nation to build a digital oilfield.
“Oil companies should be charged with the electronic surveillance,’’ he said.
During the panel discussions, Mr Isa Bala, the Director (Upstream) in the ministry said transparency was a big issue.
“When our systems are clear and transparent, when you don’t shroud processes, players will come in.
“On the issue of insecurity, only in the Niger Delta do we hear issues of vandalism and insecurity.
“It is sad to note that a report said more than N1 trillion has been spent on the region but we have nothing to show for that,’’ he said.
Also speaking, Mr Demola Adeyemi-Bero observed that the nation was still in this quagmire “because we have consumed our resources. Norway and Saudi Arabia don’t spend their excess crude accounts.
“If we produce three million barrels per day, we’ll run out of oil in 30 years. We have not thought of generations unborn.
“If the policy aims at 15 million barrels per day we’ve missed it. We need to get out of oil.
“Cote d’Ivoire gets six billion dollars yearly from exporting cocoa while Switzerland gets 60 billion dollars yearly from exporting chocolates’’.
Adeyemi-Bero said the industry must generate a massive value chain that would be sustainable in the short, medium and long terms.
“` We also need to generate revenue to sort things like insecurity and unemployment in the Niger Delta,’’ he said.
In his opinion, Mr Temidayo Adeboye of Oando Oil, canvassed for privatisation of refineries so that workers could have targets and deliver on those targets.
“Today, 95 per cent of products are moved by road. This is too expensive. You can transport at 30 per cent of that cost through pipelines and at 50 per cent by rail.
“The sector needs total, not partial deregulation. Now, you are trying to force the market to a price you pegged.
“It would never work. We have to bite the bullet once and for all,’’ Adeboye said.
Speaking on behalf of Oil Producers Trade Sector, Mr Bayo Ojulari observed that insecurity in the Niger Delta region, oil theft; lengthy contract approval circles and overlapping role of regulatory agencies were some of the issues that caused disorder in the industry.
Mr Goni Sheik, a former Permanent Secretary in the ministry, therefore, insisted that more effort should be dedicated to research and development of the industry.
He urged all stakeholders to look beyond the policy and push for an Act to regulate activities in the sector.
He solicited more attention on the need to guide investors properly from their touchdown at the airport through the remaining investment processes.
He said the professional laws of the sector should also be addressed saying “it looks like it was written by a non-professional’’.(NANFeatures)
**If used, please credit the writer as well as News Agency of Nigeria (NAN)