‘Ministers Must Stick To President Buhari’s Change Agenda’

Mr Felix Ayanruoh an energy consultant and managing partner of a US-based Wall Street firm in this interview with SAMSON EZEA tasks the new ministers on service delivery in various sectors of the economy.

What is your advice to the new ministers following their recent inauguration?
As the new ministers look to the herculean tasks ahead of them, so many of us would love to attempt to tell the ministers how to run their respective ministries. This should not be the time for sycophancy or paid congratulatory advertisement but a shift from a sickness to a wellness orientation.

All efforts should be on how to move the country forward. Their focus should be on key policy areas: the economy and jobs, transparency, meritocracy, best governance practices among others.

The ministers need to stick to the change agenda of the president. This is the time to bargain hard. The ministers should set a short-term benchmark spending targets. These targets should be removed as the economy improves, this should not be seen as a realistic worry. It’s true that in the very long run if the government were to become politically dysfunctional and not able to do anything about the economic woes we are experiencing now, the change agenda would be seen as a mere slogan.

It is common knowledge that petroleum is the mainstay of our economy. The focus of the minister of state who will be running the ministry on behalf of the president (Minister of Petroleum) is to eradicate the monumental rot inflicted on the sector by successive governments.

The recent report released by the Natural Resource Governance Institute (NRGI) exposed the atrocities committed by the NNPC. It suggested that over $32 billion oil revenue was stolen as a result of fuzzy financial practices made by the past minister and NNPC’s mismanagement of Domestic Crude Allocation (DCA), opaque revenue retention practices and corruption-ridden oil-for-product swap agreements.

The minister as the Group Managing Director of the Nigeria National Petroleum Corporation (NNPC) for the past few months carried out some reforms which can be interpreted as the right step toward revamping the sector from its past corrupt and stagnant state.

To effectively carry out meaningful reforms in the industry, there must be a robust legal and regulatory framework. This can only be achieved by passing the Petroleum Industry Bill (PIB). The bill is the key to meaningful hydrocarbon development of the industry.

In recent times, there has been a dearth of investment in the industry by both multinationals and local investors.

The minister on behalf of the presidential in collaboration with the National Assembly should work together for the PIB passage. However, the bill should be reworked to correct some issues that are fundamental to the industry’s development. The areas of transparency, presidential and ministerial powers, fiscal provisions among others issues should be looked into.

Also, The minister should carry out an effective campaign of the bill’s importance to our economy to the Nigerian people.

I will suggest that if the passage is difficult, the bill should be divided into 2 bills namely fiscal and non-fiscal. The fiscal aspect should be included in our tax laws after extensive discussions with the international oil companies. The non-fiscal aspect of the bill should be passed as a whole bill.

It is imperative to state here that the PIB when passed, will capitalize the nation’s vast gas deposits which are currently and seriously underutilized.

The extraction and utilization of gas will not only reduce gas flaring and protect the environment but will also increase power generation among others. The bill will deregulate the downstream sector, which in turn will lead to oil and gas pipelines privatization.

The private sector brings with it operational efficiency, innovative technologies, managerial effectiveness, access to additional finances, construction and commercial risk sharing.

I will state here that as a proponent of refinery privatization, I will urge the minister to look critically at the pros and cons of privatizing our ailing refineries.

Challenges and resentments of energy sector reforms in general and power sector in particular in emerging economy such as Nigeria are ubiquitous. This can be due to the widespread perception that it does not serve the interests of the population at large. Also, cost reflective tariffs, power failure, cut off non-payers, loss of jobs and the perception that only special interest are served are some of the reasons for the resentments.