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You are here:Home>>Strategic Research & Analysis>>2013 - PIB Lubricates North/South Dichotomy
Thursday, 10 January 2013 17:36

2013 - PIB Lubricates North/South Dichotomy

Written by Charles Kumolu
Mrs Diezani  Maduekwe Mrs Diezani Maduekwe vanguard

"THE Petroleum Industry Bill, PIB, currently before the National Assembly appears to have reawakened the historical North/South dichotomy over the appropriation of Nigeria’s vast economic resources. In view of the argument that PIB would generally improve the operations of the oil and gas industry, the question on the lips of many is: Is the North really afraid of PIB? CHARLES KUMOLU writes…"


WITH a history of acrimony over the manner in which Nigeria’s economic wealth,  is being appropriated among the federating units in the nation, it is not a surprise that the proposed Petroleum Industry Bill, PIB, appears to have reawakened the agelong mutual suspicion between the North and South.


Though, originally conceived to provide a functional institutional framework that will govern the nation’s oil and gas industry, the PIB has remained contentious since it was first  presented to the National Assembly, NASS, in 2008 during the administration of President Goodluck Jonathan. At the moment, the war of attrition over certain contents of the bill, appears to be an issue that would among others, make or mar  north/south relationship this new year.


Hailed as the most important document ever on the management of Nigeria’s oil resources, since oil was first discovered in commercial quantities at Oloibiri in 1956, the  story of the PIB started with the setting up of the Oil and Gas Sector Reform Implementation Committee in 2000.



And it was followed by the bill’s journey to the NASS in 2008, which was truncated by the absence of cohesion between the executive and the legislature, particularly against the background of the circulation of  too many versions of the bill. In addition, the north/south dichotomy also contributed to the fate of the bill in the Sixth NASS.


The stillbirth: For instance, on the floor of the House of Representatives in 2011, lawmakers from the North and their colleagues from the South disagreed over Section II of the bill, where it mentioned “Government of the Federation.” However, the need for the bill to be passed into law, prompted President Goodluck Jonathan to forward the new PIB to the NASS in July 2012.


The Minister of Petroleum Resources, Deziani Allison-Madueke, who disclosed this, said that what was sent to the NASS was the authentic copy which contained some security features to guard against circulation of fake copies.


“We have had to review it in great detail and rework the bill to reflect as much as possible the entire spectrum of what we considered will be the substantial strategic framework for the petroleum industry and the amalgamation of over 16 laws in the oil and gas sector, that will carry this sector for years to come. This is therefore the definitive petroleum industry bill and we expect that it will receive due consideration in the National Assembly,”she noted.


Titled a “Bill for an Act to provide for the establishment of a legal, fiscal and regulatory framework for the Petroleum Industry in Nigeria and for other related matters,” the bill among other things, seek to overhaul the  industry. This was  primarily informed by the operational ineptitude  inherent in the system, particularly in the operations of the Nigerian National Petroleum Corporation, NNPC.


Instructively, the PIB  is expected to repeal all existing laws  governing the oil industry, given that it  is a comprehensive law governing all aspects  of the  industry. In view of the the envisaged gains in the bill, many had expected that its reintroduction in the NASS by the President, would attract general sympathy. But the contrary was the case, as the opposition against the bill reemerged again shortly after it was read before the lawmakers in September last year. For instance, the disagreement between Northern and Southern senators, led to the suspension of the consideration of the bill on December 18, 2012.


Relatedly, the Northern governors it would be recalled, had set up a committee to advise them on the contents of the bill. The Ahmed Monsur, headed committee was saddled with the responsibility of studying the proposed bill and its implications for  the region.


Northern governors/senators revolt


It was, however, gathered that the committee’s findings, increased the fears of the north, as it (committee) claimed that PIB would end up allocating more money to the oil producing states. Hence it concluded that PIB could mean jerking up the 13 percent derivation acruable to the Niger Delta states.


The Monsur committee also reported that “on top of the 13.5 per cent statutory derivation from the Federation Account, the mandatory Federal allocation to the Ministry of Niger Delta, the Niger Delta Development Commission, NDDC, levy of three percent of oil operations and the massive amount of federal funds being spent on the Niger Delta Amnesty programme, the new PIB is adding 10 percent of the profit of all oil and gas companies to the Niger Delta states and communities.”


The north it was also alleged, is not comfortable that the bill did not consider gas supply to the region, just as it was uncomfortable that revenue accruing to Bayelsa, Delta,  Rivers and Akwa Ibom states, is more than that of 19 states of the North. The region also criticised some sections of the bill which makes provision for the Petroleum Host Communities Fund, PHCF.


Sections 116 and 117 of the bill reads: “There is established a fund known as the Petroleum Host Communities Fund. The PHC Fund shall be utilised for the development of the economic and social infrastructure of the communities within the petroleum producing area.”


Another  provision of the bill, which the North is opposed to, is the establishment of a National Oil Company, the National Gas Company and the National Petroleum Assets Management Corporation. Against the background of this, not a few are in hurry to know what the fears of the north are on the matter. Speaking to VanguardFeatures,VF, the president, Arewa Alliance for One North, AAON, Dr. Allahmagani Baushe, states that the PIB should address the fears of the whole nation and not the doubts of the oil producing areas alone.


He said: “The problem is that we always politicise important matters along tribal and ethnic lines. The North is not afraid of the bill and desires the best for the whole nation. Any bill made to govern the oil industry must take into consideration every part of the country.


The north as a region in Nigeria does not in any way want the PIB dead, but what we are saying is that some geo-political zones should not be enriched, while others are left behind. Afterall, the oil belongs to all Nigerians, the proponents of the current bill should also have in mind that some states in the north have discovered oil. The North should not always been seen as an enemy of the south on most issues because we are one. What the North is saying is that certain aspects of the bill should be in consonance with the mood of the whole nation and not the Niger delta region alone.”


Baushe’s position, was also re-echoed by the Chairman, Senate Committee on Housing, Sen. Bukar Abba-Ibrahim, who said that the North was opposed to the Petroleum Industry Bill because of its lopsidedness. He said that the clause in the PIB, which was asking for additional 10 per cent revenue for oil producing communities was unacceptable.


Abba-ibrahim noted: “Derivation is only one out of seven sources of revenue for the oil producing states. They have the Federal Government’s take home, the NDDC with over N500 billion being projects only in oil producing communities. They also have the Niger Delta Ministry with over N400 billion Federal Government grants in the name of amnesty and oil companies doing social corporate responsibility.”


According to him, adding another 10 per cent to the already existing revenue generators for the zone was unfair. “Adding another 10 per cent to all these seven sources, I don’t know how you are going to have peace where resources allocations are so skewed to one side and unfair.”


He said this addition in the PIB was unacceptable and suggested that the money should go into the treasury so that every Nigerian can benefit from it. “Nobody planted or farmed oil, it is God, who put it there and it will not last forever. It will get to a point where the oil will finish and another natural resource will come up and every Nigerian will benefit from it.”


But a Niger Delta activist and Executive Director of Project Equity and Justice, PEJ, Barrister Tony Peremombowie, noted that the northern anti-PIB stand would fail, adding that Niger Delta concerns should be properly addressed by the PIB.


He said: “What are they talking about? These northerners are in the habit of ganging up against anything that would make the Niger Delta benefit from its oil wealth. The north should rather think of ways of reviving agriculture in their region, because their potentials are there.


PIB is a responsible document which the senators, should as a matter  of  urgency and equity pass into law.” But another prominent Nigerian, from one of the oil producing states, Chief Mrs. Ritalori Ogbebor, noted that had governors of the Niger Delta states, utilised the 13 percent derivation judiciously, the current opposition would not have come up.


She stated that in face of the alleged mismanagement of the 13 percent derivation fund, elders of the Niger Delta region does not seem to have the enthusiasm to speak against the position of the north, stressing: “The PIB is should be seen as a good thing. But when the governors have not properly used the 13 percent derivation for the good of the people, how then do you expect us to assist them on the PIB, which would mean appropriating more money to them.


“It is because of this kind of opposition from the north, that we have been in the vanguard of the calls for a judicious use of all the funds accruable to the region. We fought for 13 percent derivation. I personally fought for it because I know that the terrain of the Niger Delta requires much money to fix. But we have not been impressed because they governors have little or nothing to show for the thirteen percent derivation.”


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