The attempt by the Ministry of Petroleum Resources to assume control over the proposed Incorporated Joint Ventures (IJVs) and the Asset Management Company to be created by the new Petroleum Industry Bill (PIB) may set the ministry on a collision course with the Nigerian National Petroleum Corporation (NNPC), investigations have revealed.
The original PIB submitted to the National Assembly by the Umaru Musa Yar’Adua administration had provided for the corporatisation of the oil joint venture (JVs) assets held by NNPC and the international oil companies (IOCs) into IJVs.
But the IOCs had opposed the establishment of the IJVs following concerns that the NNPC, which controls majority stake in the existing joint venture oil assets, might insist on operating the incorporated entities.
As a result, the IJVs were removed from the revised reform bill resubmitted by the administration of former President Goodluck Jonathan in 2012 to the National Assembly.
However, the current administration of President Muhammadu Buhari has unbundled the PIB into three legislations for easy passage and also reintroduced the IJVs in the revised bill to resolve the cash call challenged hampering the existing JVs, which have accumulated to unpaid arrears of over $6 billion.
It was also gathered that splitting the PIB was done to ensure that regulatory and fiscal issues are dealt with separately.
The Ministry of Petroleum, it was learnt from a top NNPC source, is in the final stages of completing the comprehensive executive drafts of the split PIB.
It was also gathered that the first of the three pieces of legislation under the revised PIB being prepared by the executive arm of government is called the “Governance PIB”, while the version drafted by the Senate is called the “Petroleum Industry Governance Bill, 2016”.
Investigations have, however, revealed that the NNPC is not happy with the attempt by the Ministry of Petroleum to take over direct control of the proposed IJVs, Production Sharing Contracts (PSCs) and the Asset Management Company.
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