Presidency: PIGB Contains Constitutional, Legal Breaches

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Muhammadu Buhari
Muhammadu Buhari

• Atiku, Adebanjo, environmentalists reject veto

Deji Elumoye, Omololu Ogunmade, Adedayo Akinwale in Abuja and Segun James, Shola Oyeyipo in Lagos

The presidency wednesday in Abuja cited constitutional and legal breaches as the reasons President Muhammadu Buhari withheld his assent to the Petroleum Industry Governance Bill (PIGB).

Senior Special Assistant to the President on National Assembly Matters, Senator Ita Enang, in a statement, gave three reasons for the decision that has come under severe criticism from leading politicians and environmentalists, including former Vice President Atiku Abubakar, Chief Ayo Adebanjo and Nnimmo Bassey.

According to Enang, the National Assembly empowered the Petroleum Regulatory Commission, one of the bodies created by the bill to unduly retain 10 per cent of the funds it generates to the detriment of the three tiers of government and the Federal Capital Territory (FCT).

He also said the president vetoed the bill because it expands the scope of the Petroleum Equalisation Fund (PEF) in a manner that is antithetical to the policy of his administration and consequently stipulating provisions that are in conflict with independent PEF.

Enang also disclosed that the president opted to return the bill to the National Assembly because it consists some legislative drafting concerns, which he said, had the capacity to create ambiguity and conflicting interpretation.
He stated the president’s reasons for declining assent as follows, “The provision of the bill permitting the Petroleum Regulatory Commission to retain as much as 10 per cent of the revenue generated unduly increases the funds accruing to the Petroleum Regulatory Commission to the detriment of the revenue available to the federal, states, Federal Capital Territory and local governments in the country.

“Expanding the scope of Petroleum Equalisation Fund and some provisions in divergence from this administration’s policy and indeed conflicting provisions on independent petroleum equalisation fund.

“Some legislative drafting concerns which, if assented to in the form presented, will create ambiguity and conflict in interpretation.”

Enang, who said it was inappropriate to make public statement on any executive communication that has not been read on the floor of legislative chambers, said he was compelled to make these clarifications because of some misrepresentations by the media on the president’s decision.

While appealing to the National Assembly for understanding of his action, the presidential aide added that if such clarifications were not made, such misrepresentations could result in blackmail and pit both the executive and the legislature against the public.

He added that none of the reasons reported by the media for the president’s decision to return the bill represents the true situation.

He explained, “By presidential communication of July 29, 2018 (one month ago) addressed to the Senate and House of Representatives, Mr. President did communicate decline of assent to the Petroleum Industry Governance Bill 2018 for constitutional and legal reasons stated therein.

“By convention, it is inappropriate to speak on the content of executive communication addressed to the legislature until same has been read on the floor in plenary.

“But I plead for the understanding of the legislature that due to the misrepresentations in the public domain and apparent deliberate blackmail which if not promptly addressed may set both the executive and the legislature against the public and even the international investment community, this be excused.

“None of the reasons for withholding assent by Mr. President adduced by the media is true. Other issues therein contained. May this please answer some of the issues raised until the communication is read on the floor.”

The PIGB was passed by the National Assembly in March, 2018 and was transmitted to the president in July for his assent.
The bill, which was initiated by late President Umaru Yar’Adua and sent to the sixth National Assembly headed by Senator David Mark in 2008, has been enmeshed in controversy due to some of its provisions.

The Senate had on March 28 passed it having adopted the report of the conference committee of the PIGB, which harmonised the versions earlier passed by both Senate and House of Representatives.

The harmonised version of the bill seeks to, among others, unbundle the NNPC and merge its subsidiaries such as Department of Petroleum Resources (DPR) and Petroleum Products Pricing Regulatory Agency (PPPRA), into one entity.
The objectives of the PIGB include transforming the administration of the upstream, midstream and downstream sectors of the Nigerian petroleum industry.

The bill creates a framework that will free up acreages that are not being developed by current license and lease holders, thereby creating opportunities for new investors. This will bring substantial new investment to the nation’s oil and gas industry.

It also ensures effective management of the environment by petroleum operators and administrators.
It provides a framework to unleash midstream activities, which will open up the market for the supply of gas and other downstream products, for economic growth and provides much needed legal backing for the deregulation of our downstream petroleum sector.

Atiku, Adebanjo, environmentalists reject veto Strident criticisms followed the presidential veto yesterday as politicians and environmentalists described it as an unfortunate development.

Leading the critics was former Vice President Atiku who said the veto was “a monumental mistake,” adding that the reason given by the president for rejecting the bill also betrayed the fact that the current administration was out of tandem with global best practices.

The former vice president wondered why that the National Assembly in conjunction with the oil majors and host communities would be allowed to put in so much work and yet nothing came out of it.

He said, “The PIGB will be a great catalyst for Nigeria’s oil and gas sector and has the capacity of stabilising our host communities, boosting our reserves and creating the enabling environment that attracts the type of investment that will make Nigeria a world leader in the petroleum industry.

“In recent months, Nigeria became the world headquarters for extreme poverty, having overtaken India as the nation with the most people living under $2 a day (81 million people). If we are to change the situation and bring our people out of poverty, we must support legislation such as the PIGB.”

Afenifere chieftain, Adebanjo, reacting to the veto, said the Nigerian leader was not only undemocratic; he was also not a man of his words.

According to him, the development “is very unfortunate,” noting, “I am the last person you should be asking about Buhari. You know I told you I will be disappointed if he is democratic and that I am disappointed that he has not disappointed me. What is he doing now that I have not said before? He doesn’t want to rule, he wants to dominate!”
The people of Niger Delta region, who are mostly affected by the impact of oil and gas activities in the country, reacted angrily to the president’s action, accusing him of not only being selfish, but also against the development of the region.

According to environmental rights activist, Mr. Nnimmo Bassey, an architect, who chairs Environmental Rights Action (ERA), a Niger Delta based advocate group against environmental pollution, the National Assembly should immediately override the presidential veto in the interest of the nation and the environment.

“Although I’m not a fan of a fragmented PIGB, it would be okay if the National Assembly overrides the presidential dissent. The petroleum sector needs a workable structure. The PIGB would comprehensively handle the pressing problems of our devastated environment and communities,” he said, adding, “The fact that the president stepped up to speak about the PIGB challenging his powers as the Minister of Petroleum Resources is important because we are reminded of a vital point: that this represents a sad commentary of the petroleum resources industry in Nigeria.”
This position was also shared by a Bayelsa State environmental activist, Mr. Alagoa Morris, who wondered why the president had the belief that the bill would whittle down his powers as Minister of Petroleum Resources when the reverse is the case.

“I don’t think the bill will reduce the powers of the president if signed into law; instead, it will retain it, if not increase it. The only thing that will change is that the technocrats will manage the system. Unfortunately, that is what the politicians don’t want. He should sign it in the interest of peace.”

Elder statesman and Niger Delta leader, Chief Edwin Clarke, declined to speak on the issue, saying that he was still studying the situation before he could make any comment.

But for retired Colonel Tony Nyiam, another political and environmental activist in the Niger Delta region, “It is most sad that the PIGB, which has been in the works for many years now, has been shutdown. It shows that President Buhari is insensitive to things that are sensitive to the Niger Delta people.”

An oil and gas lawyer, Mr. Uche Nwokedi (SAN), said since Buhari refused to assent to the bill, the country should continue to operate the Petroleum Act of 1969.

Nwokedi noted that as far as he was concerned, nothing was wrong with the Petroleum Act of 1969, as the law had everything to effectively administer the industry.

A prominent civil society group, Human Rights Writers Association of Nigeria (HURIWA), described the presidential veto as an “intentional retrogression” and “a show of the will- not- to overcome.”

HURIWA also affirmed that the decision might not constitute any shock to most rational thinkers in Nigeria and globally, because it is a notorious fact that pragmatic governance change has not yet manifested in Nigeria even with much talked about change mantra mouthed by President Buhari and his officials.

In a statement by its National Coordinator, Mr. Emmanuel Onwubiko, the rights group noted that it had cost the country humongous amount of public funds to build up the proposed legislation that had just suffered political still-birth.

“We absolutely condemn this ill-advised decision of Mr. President to reject a bill that so much intellectual works have gone into producing it just as valuable resources that could even have been deployed to clean up the messed up and impoverished Niger Delta oil mineral producing communities have been spent to reach a clearly acceptable determination of the final copy of the bill only for this sad end to be intentionally choreographed.”