Home OPINION INTERVIEW How Nigeria Lost $50 Billion Investment For Delayed Passage Of Petroleum Industry...

How Nigeria Lost $50 Billion Investment For Delayed Passage Of Petroleum Industry Bill – Rep. Elect

Mr. Sergius Oseasochie
Mr. Sergius Oseasochie

Within the lull of the non-passage of the Petroleum Industry Bill (PIB), most investments that should have come to Nigeria found a safe alternative in Mozambique, and additional development of oil in Ghana, Sierra Leone, Kenya, Tanzania and Uganda. All these amount to about $50 Billion.
This is the view of Mr. Sergius Oseasochie who is the Managing Director/Chief Executive Officer of the Relentech Integrated Services Ltd, Nigeria and who was recently elected into the House of Representatives to represent Esan North-East/Esan South-East of Edo State in an interview. He lamented the non-passage of the PIB by the seventh National Assembly even as he stressed the need for the total deregulation of the downstream sector of the oil industry.
Excerpts from the interview:
Do you think the seventh National Assembly is justified over their inability to pass the Petroleum Industry Bill?
Sergius Oseasochie: Not at all. The seventh Assembly should have passed the Petroleum Industry Bill given the volume of work already done by the sixth Assembly on the recommendations of the Oil and Gas Industry Committee (OGIC), with the impact and benefits of such reform in a high oil price regime.
The impasse in the passage of PIB has led to uncertainty in the investment climate in Nigeria and the ability of the oil and gas companies to guarantee returns on investment based on their portfolio across other regions of the world. Within the lull of the non-passage, most investment that should have come to Nigeria found a safe alternative in Mozambique, and additional development of oil in Ghana, Sierra Leone, Kenya, Tanzania and Uganda. All these amount to about $50bn.
Following your election into the National Assembly, what contributions will you make to ensure that the PIB does not suffer the same fate that has befallen it in the past?
I shall immediately review all the legislative notes and submissions from the 6th and 7th Assemblies with a view to reducing areas of discordance while getting maximum value for Nigeria, given my background in the oil and gas industry. Professional societies such as the Society of Petroleum Engineers (SPE) that are apolitical shall be requested to provide their unbiased communiqué over the years.
What are your views about the much-touted corruption in the oil and gas industry? Where do you think things started to go wrong and how can the rot in the sector be addressed?
Strategic reforms shall be recommended in the sector through tenured appointment of young technocrats within the system with considerable career life. This is to steer the ship aright bearing in mind that the consequence of non-performance leads to early retirement. Independent boards should be appointed in line with CAMA (Companies and Allied Matters Act) to reduce interference.
If you were to advise the Muhammadu Buhari administration, what will you advise should be done to the country’s refineries?
Given the amount of money spent on subsidy (N3 trillion naira), I shall advise the government in the short term to repair the refineries and implement both new governance models such as the NLNG model and business model to encourage profitability. This guarantees the country’s energy security, while ensuring that its product serves as feedstock to petrochemical and manufacturing industries. In the long run, government should fully deregulate the downstream. You cannot be issuing licenses for importation of fuel and fixing prices for the product and expect people to invest in building refineries. In Western democracies, refineries are owned and managed by individuals and businesses, not government. This will naturally create employment and increase government revenue through tax. If the business was not profitable, the likes of Aliko Dangote would not have been building their own refineries. The question will be how many Dangote’s do we have in Africa? This is why government should stay off completely to allow simple economic dynamics come to play in this sector.
Strikes, production shutdowns and vandalisms have over the years been sore points to the Nigerian oil industry. In what ways do you think these can be addressed, in view of the huge revenues the country is losing in this regard?
Proactive intervention and collaboration with the executive arm in engaging the labour union shall reduce industrial unrest which leads to production shutdown in the present situation of low foreign exchange income occasioned by low oil price. Vandalism needs to be addressed via the critical infrastructure intervention command and force under the NSA (National Security Agency) created by a presidential order. This would remove the current impediment on the current structure of the Police and Armed Forces commands in the protection of oil pipelines limited by command jurisdiction. The sophistication of the vandalism is above the capacity of the NSCDC (National Security and Civil Defence Corps), charged with the responsibility without the necessary platform for intervention.
The fall in the prices of crude oil in the international market is currently hurting the Nigerian economy in no small measure. What measures do you want the Federal Government to put in place to cushion the effect of the drop on the Nigerian economy?
Diversify the economy: “Nigeria Beyond Oil.” As long as the world cannot control its appetite for oil, there will be boom, burst, downturn, meltdown etc. No modern economy can rely on one commodity as its source of revenue, not to talk of the most populous black nation with over 180 million people of which 60 per cent are young people.
There should be massive investment in agriculture. We should be able to feed ourselves and export food to our neighbours. Our population and land mass should count for something in the sub-region. The best chocolates are from Switzerland and yet they do not have cocoa plantations. We should farm our land and process the produce. This will create employment for our youths. The World Bank, ADB, international donor agencies are ready and willing to support this initiative. We just have to kick the habit (over dependence on oil) and the entire storyline will change. Yes, it is as easy as that. With increased security, the tourism industry will thrive. We do not have to look for the Western world. If we can lure our brethren in the region to Nigeria, the West will follow thereafter. We have all it takes to be the Dubai of Africa. [myad]

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