New oil contract law to fetch Nigeria $1.5b, says Lawan
• Buhari Senate’s seeks nod to reimburse Kogi N10b for projects
Senate President Ahmed Lawan yesterday said that the passed Deep Offshore and Inland Basin Production Sharing Contract (Amendment) Bill 2019 would make Nigeria $1.5 billion richer by 2020. He assured foreign oil firms and others operating in the country that the law was not meant to discourage investments.
Lawan spoke after the upper chamber legislative amended and sanctioned the piece of legislation, noting: “When we do legislation in the National Assembly, we are always mindful of the need to have a competitive environment just like we have done in this one, and when we work on the PIB maybe from January, we will make ensure that it is a win-win for the country on one hand, and those doing business in Nigeria’s oil and gas industry. By passing this bill, Nigeria will be at least $1.5 billion richer in 2020.”
The red chamber had allegedly uncovered a $21 billion (N7 trillion) revenue loss to multinationals in the last 26 years on account of the non-implementation of the PSC.
During debate on the motion initiated by Ifeanyi Ubah and co-sponsored by 27 others, the Anambra legislator informed the Senate that key contractual agreements between Nigeria and oil majors had not been adhered to by concerned parties over the years, resulting in the huge liability.
The N7 trillion, according to him, was fund that could have come into the federation account anytime oil price rises above $20 per barrel as captured in Section 16 of the law.He regretted that the periodic reviews due in 2008, 2013 and 2018 were not carried out, costing government more revenues.
Consequently, an amendment bill seeking for penalties scaled first reading last Thursday.Passing the piece of legislation for second reading yesterday, the Senate introduced Sections 17 and 18 into it for appropriate penalties against violation of Section 16 of the Act.
Besides, President Muhammadu Buhari has written the lawmakers requesting their approval to refund N10 billion to Kogi State for projects it executed on behalf of the Federal Government.In the letter addressed to Lawan, the president explained that the money was to offset local debts the state government incurred in executing the infrastructure. Buhari said that his request was based on the resolution of the eighth Senate.
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