PIA to stimulate investment in the Oil and Gas industry – Wabote.

The Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Engr. Simbi Wabote has stated that the Petroleum Industry Act (PIA) 2021 will enable the development of host communities, reduce funding pressure on Government, boost capacity development in identified skills gaps, and stimulate investment in the oil and gas industry in Nigeria. The Executive Secretary made the assertion at the Association of Energy Correspondents of Nigeria (NAEC) 2021 Strategic International Annual Conference held recently in Lagos`

Speaking through the Director, Monitoring and Evaluation, Mr. Tunde Adelana, he said the PIA will foster the development of critical infrastructure and enhance the utilization of Gas resources for national development. Engr. Wabote stated that the PIA provides legal governance, regulatory and fiscal framework for the oil and gas industry in Nigeria, and development of Host Communities. The Act, he further said, contains 5 Chapters, 319 Sections, and 8 Schedules dealing with Rights of Pre-emption; Incorporated Joint Ventures; Domestic Best Price, and Pricing Framework.

According to him, the PIA will bring about the formation of NNPC Limited, its Functions; Gas Flare and Gas Infrastructure; Midstream Operations; Fiscals, Taxes, and Royalties; and Host Community Development with a bid to engage the business of renewables. Engr. Wabote noted that the PIA Petroleum Profits Tax (PPT) replaces the National Hydrocarbon Tax, alongside royalties reduced for onshore areas, shallow water, deep offshore and frontier basins, and natural gas.

Speaking on other aspects of the oil and gas value chain, the Executive Secretary indicated that the midstream activities behoove operators within the sector to ensure the National Strategic Stock, enhance the decommissioning and abandonment fund and eliminate government’s regulation on pricing of petroleum products. He also added that the Act will ensure gas flaring penalties, establishment of Midstream Gas Infrastructure, and special regulation for Midstream and Downstream Gas Operations as well as Natural Gas Prices for strategic sectors. In summary, he maintained that the Act will boost Local Content implementation in the oil and gas industry.

In a presentation on “Boosting the Nation’s Economy through Gas Utilization”, the Managing Director and Chief Executive Officer of Nigeria LNG Limited, Dr. Philip Mshelbila discussed  the context of energy transition in the light of cleaner, cheaper and sustainable energy. The Chief Executive who was represented by the Manager, Corporate Communication and Public Affairs, Mrs. Sophia Horsfall, stated that giant technological advancements have been made in the area of renewable energy and battery storage. However, renewables alone cannot meet the energy demand in a sustainable manner and natural gas is the next cheapest option. “It is the smart option to renewables”, Dr. Mshelbila asserted.

Speaking earlier, the Conference Chairman and Chief Executive of Degeconeck Nigeria Limited, Mr. Biodun Adesanya set the tone for the international conference with the theme, “PIA: Energy Transition and the Future of Nigeria’s Oil and Gas” where he stressed the need for participants to embrace the significance of the occasion and chart the way forward to effectively communicate rather than inform the public on government’s policy on the gas revolution and energy transition.

In the same vein, the NAEC Chairman, Mr. Olu Phillips, commended the initiative of the Federal Government for its swift response to economic shocks the dwindling price of oil brought during the heightened state of the corona virus pandemic within the last quarter of 2019 and mid-2020. Mr. Phillips in his welcome address, indicated that the decisions of government brought about outcomes which formed the fulcrum of this year’s international conference.

He hinted that from the Year of Gas declared in 2020 and aggressively elevated to a Decade of Gas in the first quarter of this year, Nigeria seemed to have found its path to restoration and a possible growth trajectory. A consensus, which he mentioned, arose from practical decisions amongst stakeholders to offer clean energy solutions in a sustainable manner.