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PIB, debts and way forward for Nigeria

The new Petroleum Industry Bill states that oil-producing communities should be allocated three per cent of the profits made from oil proceeds.

(FILES) In this file photo taken on March 26, 2018 a gas flare burns at the Batan flow station operated by Chevron under a joint-venture arrangement with the Nigerian National Petroleum Corporation (NNPC) for the onshore and offshore assets in the Niger Delta region. – Nigeria’s parliament on July 1, 2021 voted to approve a long-delayed oil and gas law that aims to attract new foreign investment to the OPEC country’s petroleum industry.<br />The Petroleum Industry Bill or PIB had been under review in the National Assembly for nearly two decades, beset by disagreements, including over how much revenue should go to local communities in oil-producing regions. (Photo by PIUS UTOMI EKPEI / AFP)

Sir: The new Petroleum Industry Bill states that oil-producing communities should be allocated three per cent of the profits made from oil proceeds. The Niger Delta groups are demanding 10 per cent in their proposal to the National Assembly. The National Assembly committee that reviewed all the proposals suggested five per cent.

In the original Petroleum Industry Bill (PIB) there was no mention of money for frontier states, but what was finally passed as the bill allocates thirty per cent of the total oil revenue/profits of the Nigerian National Petroleum Corporation (NNPC) to the prospecting of oil in frontier states like Bauchi, Maiduguri, and Lake Chad regions. For the sake of the unity of Nigeria, an urgent review of this percentage needs to be done to be commensurate with what the Niger Delta groups are requesting.

However, it might be a total waste of resources to invest 30 per cent of total oil revenue in prospecting of oil in places where failures have been recorded in search of oil over the decades instead of economic diversification into high technology and more foreign trade/investments deals that can stand the test of time in line with what is trending. The world’s economy is getting less dependent on oil and the big oil companies and corporations are downsizing, reducing the budget for future oil deals.

Nigeria earned $997.1 billion in 28 to 31 years from the sale of crude oil according to the Organisation of Petroleum Exporting Countries (OPEC). But based on estimation due to the dwindling oil price per barrel of crude oil sold, oil revenue records in the last three years would possibly be less than $50 billion and unfortunately, the present administration of President Muhammadu Buhari-led Federal Government has been borrowing public funds from other developed countries to run the economy and is now highly indebted presently to the tune of N33 trillion and there is another over N2 trillion loan request recently approved by the National Assembly; and over N950 billion added as the supplementary budget for the year 2021. The questions now are: why is the nation being plunged into high debt? How will this indebtedness to the tune of N35.9 trillion be cleared before the next political dispensation?

Finally, there is a very urgent need to also review the national minimum wage of N30,000 for workers. Serious efforts should be made to regulate the prices of goods and services. It is high time we started looking inwards beyond oil and gas by largely exploring opportunities, especially in the areas of Agriculture, mining, exports, tourism, maritime, and technology. Nigeria needs to utilise its other mineral deposits/resources through entrepreneurship and SMEs in the rescue of the economy; and deployment of technology to curb the prevailing insecurity. Our economy and financial standing as a nation should be able to match those of other developed countries, so our dear country, Nigeria can be among the comity of nations in the world.

By Kenneth Agwasim