The Centre for Social Justice (CSJ) on Monday called on the executive arm of government to re-introduce the Petroleum Industry Bill (PIB) to the 8th National Assembly and use the party machinery and public pressure to ensure that the Bill is passed in record time before the end of the 2015 fiscal year.
The lead Director of the organization, Mr. Eze Onyekpere made the call at a media presentation of an independent study on the Nigerian Gas Master Plan (NGMP) by the CSJ and with the support of Heinrich Boll Foundation.
The Organisation is also calling for total removal of fuel subsidy to free more funds for capital projects, arguing that the subsidy had since been removed in states outside Abuja and Lagos where fuel is sold at higher prices beyond the government regulated price.
‘‘Scrapping of fuel subsidy can yield about N1 trillion a year which FGN in collaboration with states and local governments can dedicate a part of it to the funding of the Master Plan.’’
Onyechere said the need for reintroduction of the PIB had become necessary since Nigeria lacks a comprehensive implementable energy policy that incorporates all energy segments and sources for national development.
According to him, the new PIB should take cognisance of the views of industry stakeholders guaranteeing appropriate incentives and returns on investment and also good returns to the public treasury.
In considering the bulky nature of the PIB, the CSJ Director urged the government to consider breaking the bill into different bills for ease of passage but suggested that the parts dealing with gas can be isolated and immediately passed into law.
As a way of making the law more attractive to investors, he urged the government consider incentives benchmarked with the incentives offered by other African Gas Producing Nations to encourage investments in gas exploration to increase Nigeria’s reserves.
Considering the abundant renewable energy resources available in the country, Onyechere is of the view that government should plan and implement an energy policy that targets a renewable energy contribution of not less than 20 per cent in the next ten years.
For him, the NGMP should be properly documented and made available to the public for their input and review and that official report on the progress so far should be available to the public.
Continuing, he also canvassed for government collaboration with the private sector aimed at creating special purpose vehicles to tap resources from small and medium scale Nigerian investors to fund the NGMP and to avoid over-reliance on the proverbial foreign investors who do not have a developmental, but strictly profit agenda.
He equally tasked government on the recovery of the $4.1bn gas flare outstanding penalty identified by the Nuhu Ribadu led Petroleum Revenue Special Task Force to fund gas infrastructure plan, just as he stated that funding for NGMP can also come from special and dedicated funds for instance:
‘‘If the $18bn unremitted oil funds identified by NEITI is recovered, a part of it may be dedicated to the NGMP. Dedicating and ring-fencing the proceeds of Federation Account dividends and tax from existing Bonny LNG Company to new gas investments is also necessary.’’
While calling for effective implementation of the NGMP in terms of attracting buyers, the CSJ boss said Nigeria can afford to build the new LNG plants either from the treasury, public loans and bonds, or in collaboration with private sector operatives.
‘‘The cost is not beyond the reach of Nigeria. Government has invested a lot of resources in Real Time Monitoring of Pipelines coupled with pipeline security contracts. Thus, continued vandalisation of pipelines is unacceptable as the security system must be made to work to secure the pipelines. This brings to the fore the need for new technologies for pipeline protection such as drones and making local host communities actual stakeholders in the pipelines,’’ he added.
He regretted that Nigeria and its partners have so far invested $11.675bn in the LNG Plant in Bonny and associated investments in ships for the six trains of the Bonny Plant.
”There are plans for new LNG projects in Brass and Olokola and Train 7 of the Bonny Plant but the evaluation of the investment decisions have been unduly prolonged. Considering new discoveries of gas and investments in other countries, if the final investments decisions are not taken soon, the feasibility of the Nigerian projects in terms of attracting buyers may be reduced.
”The demand for gas in the Nigerian domestic market far outstrips the supply and there is insufficient infrastructure to meet the needs of the market. Beyond financing and technical issues, awareness of the goals and details of NGMP is low outside the small enclave of oil and gas technocrats.
”For such an important national policy that will touch the lives and income of the population through the gas to power, commercial and industry initiatives, it should have been popularised by government through engagement with various stakeholder groups. Also, the idea of creating special vehicles to tap resources from small and medium scale investors would be necessary to avoid over-reliance on the proverbial foreign investors who do not have a developmental, but strictly profit agenda.”
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