afrol News, 14 October - The Nigerian Senate has endorsed the Federal Government's planned deregulation of the oil industry, saying that it had become crucial to redress the looming problems in the petroleum sector.

The new Petroleum Industry Bill (PIB) which has been under serious scrutiny, proposes that the oil industry would be substantially free from government control and run strictly as a business in a deregulated environment.

Government is also aiming at deriving more revenue from petroleum resources by increasing royalties and taxes payable by oil companies, in addition to giving host communities stakes in the ventures.

The Senate's information and media committee chairman, Ayogu Eze, said the government is ready to carry out activities leading to deregulation though it has not been passed into a law, emphasising that the issue of regulation was an administrative issue which was never protected by the law.

“The issue of subsidy was not put there by law. It was a government policy that brought subsidy to cushion the effect of rising prices of petroleum products on the people,” he told local news reports.

The Minister of Petroleum Resources, Dr Rilwan Lukman said the proposed legislation was geared towards reducing government expenses in order to have more money to channel into the development of other critical sectors such as health, education and the general improvement of infrastructure.

The minister expressed optimism that as the seventh highest oil producer in the world, the PIB, when passed would help to transform the Nigerian National Petroleum Corporation (NNPC) into a national oil company that would be commercially viable.

However, the bill has come under criticism from international oil companies (IOCs) accusing the government of trying to create a monopoly for the national oil company and also for the fiscal proposals which are considered uneconomical.

The local trade union, Congress of Nigeria (TUCN) has threatened to mobilise all its affiliates and the people to protest the proposed deregulation which has allegedly been fixed for 1 November this year.

But, on the other hand, the International Monetary Fund (IMF) has described the PIB as a professional legislation capable of positively repositioning the Nigerian economy.

The IMF’s Fiscal Affairs Adviser and leader of the delegation, Charles Mcpherson, told This Day, that the proposed reforms would form the integral part of Nigeria’s economic reforms.

“It is a very, very exciting project, particularly after knowing how it began and how you worked it out over the years. It’s very professional, very thorough work and so I don’t know what we can add, I hope we can add something,” he said.

He said the transformation plans for the NNPC which is central to the success of any incorporated joint venture approach, would free up the funds in the budget to independent financiers that have NNPC’s activities.

Meanwhile, the endorsement of the bill by Senate saw the resurgence of fuel queues in Abuja.

A statement by the NNPC’s Group General Manager, Public Affairs Division, Dr Levi Ajuonuma, linked the situation to the refusal of filling station attendants to dispense products through all the nozzles at the filling stations.

Mr Ajuonuma accused some independent and major marketers of reducing the number of trucks sent out to bring in products to the fuel stations.

By staff writer

© afrol News

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