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Sylva in Petroleum: Four Years of More of the Same

An Editorial Opinion of the Board of Africa Oil+Gas Report

It is unlikely that Timipre Sylva, a career Nigerian politician more likely keen on dealmaking than overseeing reforms, will follow up on the hot button issues of value addition in Nigeria’s Hydrocarbon landscape.

The passage of the Petroleum Industry Bill, the sale of a slice of NNPC equity in upstream JVs, disposal of state owned infrastructure that the corporation is unable to properly run, the removal of gasoline subsidies: these value yielding initiatives will not likely be delivered in the next four years.

Sylva’s predecessor as Nigeria’s Minister of State for Petroleum, Ibe Kachikwu, took a stab at some things, but he didn’t get very far. He succeeded in pushing the payment of cash call arrears for JV operators, got the President to sign off on policy to licence gas flare sites and launched a policy document each on oil and gas.

But in the absence of an act of parliament reforming extant hydrocarbon laws and operational norms, with those policies at its heart, Mr. Kachikwu’s documents have gone nowhere.  Those policy documents suffered the same fate as Mrs. Diezani Allison Madueke’s Gas Revolution Policy and President Olusegun Obasanjo’s Oil and Gas Reform initiatives.

At the core of the current challenges are two things (1) President Muhammadu Buhari’s statist mindset and his disdain for the Nigerian business class (2), the President’s unwillingness to closely track the ministry’s work, which provides undue advantage to personal aides, especially his chief of staff, Mr. Abba Kyari, to hijack the ministry of petroleum resources and run an upstream lease management agenda focused on handling assets to the NPDC rather than supporting transparent bid processes.

NNPC will remain as powerful and unaccountable as it was in the last four years; a commercial entity pretending to be regulator. NPDC, its operating subsidiary, will pay neither rent nor royalty for acreages it acquires and the state hydrocarbon company will continue spending billions of dollars to refurbish  moribund refineries that otherwise should be privatised –which translates to frittering away what should otherwise flow into the treasury, for the next four years.

We, at Africa Oil+Gas Report would be enormously encouraged if Mr. Sylva could be both courageous and tactful enough to cut through the fog and convince the President to provide an environment for the flourish of investment into what is potentially Africa’s largest hydrocarbon industry. But from where we are sitting, we don’t see that happening.

 


Human Capacity, Governing Laws

The guiding philosophy of the Africa Oil+Gas Report is to highlight the involvement of the continent’s technical minds in the exploitation of her resources and to put on notice, to all our readers, the governing environment that determines whether these resources aid the emergence of the industrial society, or keep ordinary Africans in perpetualwant and servitude.

It’s interesting, then, that around the same time our editors were preparing a special edition to focus on
the human capacity challenge, the Nigerian Petroleum Ministry submitted an ambitious, 223 page legislation, christened The Petroleum Industry Bill (PIB) to the country’sNational Assembly.

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