Reps okays Petroleum Industry Governance Bill

* Summons Kachikwu, Baru, PPPRA boss over fuel subsidy payments
* Approves Maritime University

The governance aspect of the Petroleum Industry Bill (PIB) that provides for transparency and international best practices was on Wednesday passed by the House of Representatives.

The report was laid on Tuesday, before the House by the ad-hoc committee Chairman, Hon Ado Dogua (APC/Kano).
The bill among others unbundles the Nigerian National Petroleum Corporation (NNPC) and approves the merger of all its subsidiaries.

When the matter came up during the committee of the whole chaired by the Deputy Speaker, Hon Lasun Yussuf, the lawmakers considered and approved the 134 clauses contained in the report.

The report considered by the House is of the ad hoc committee on petroleum industry on a bill for an Act to provide for the governance and institutional framework for the petroleum Industry and for other matters related.

Meanwhile, the House has summoned the Minister of State for Petroleum Resources, Dr Ibe Kachikwu, the Group Managing Director of the NNPC, Dr Maikanti Baru and the Executive Secretary of the Petroleum Products Pricing Regulatory Agency (PPPRA), Abdulkadir Saidu Umar, to appear before it’s Committee on Finance and Petroleum Downstream to explain the current subsidy payment by the federal government.

The House passed the resolution on Wednesday, following worries over the lingering fuel shortage across the country, as well as reports attributed to the NNPC announcing the implementation of the subsidy regime by the President Muhammadu Buhari-led administration.

Also in passing the resolution, the House called on the Federal Government to make provision for subsidy payment in the 2018 Appropriation Bill, if it plans to continue with subsidy payments.

The House resolution followed the adoption of the motion of urgent national importance sponsored by Hon Karimi Sunday, on the need to investigate the fuel subsidy payments by the NNPC.

In his lead debate, Hon Sunday said that the current landing cost of petrol is N171 per litre despite the fact that the Federal Government has pegged the official rate at N145 per litre, adding that the NNPC is at the moment paying the N26 per litre difference despite government’s position that it has removed petroleum subsidy.

According to him, the implementation of the subsidy regime has no parliamentary appropriation in the 2017 Appropriation Act.

He also stated that the NNPC had in January 2017, conceded that fuel subsidy had returned, adding that the corporation between January and March of the same year recorded an under recovery of N46.86billion, while as at December over N300billion had been expended on subsidy alone in 2017.

According to him, the under recovery in the downstream petroleum market implies that the expected open market price for petrol is below the approved retail price as such, the NNPC’ has been absorbing the extra cost and paying subsidy to importers of petrol.

He said, “The under recovery is caused by increase in the price of crude in the international market from about $20 per barrel in 2015 to $50 p/b in 2017 and $70 p/b currently.

“The increase in price of crude oil, low rate of the Naira and difficulties in assessing foreign exchange have caused marketers to discontinue petrol importation.”

The lawmaker expressed concern that the subsidy payment by the NNPC contravenes Section 80(4) of the 1999 Constitution (as amended), “as the subsidy regime is being done without appropriation or approval by the National Assembly and as such is illegal and unconstitutional.”

Pointing out that the 2018 Appropriation Bill does not include provision for petroleum subsidy, Hon Sunday stated that “such non-appropriated expenditure on subsidy is illegal and susceptible to corruption, embezzlement and mismanagement if not subjected to approval and scrutiny by the parliament.”
In adopting the motion, the House also decided that PPPRA chief will account for the monies spent on subsidy payment by the present administration since January 2017 till date as well as disclosing the current petroleum pricing regime.

In a related development, the House also approved the establishment of a Maritime University in Okerenkoko, Delta state.

According to the lawmakers, it approved and considered all the clauses in a report of the Committee on Maritime Safety, Education and Administration on a bill for an Act to Establish the Nigeria Maritime University located in Okerenkoko, Delta State.

Henry Omunu, Abuja