The President of the Senate, Ahmad Lawan, has said that the Petroleum Industry Bill (PIB) which is presently before the National Assembly for consideration and passage will ensure that Nigerians benefit optimally from crude oil production and sale of fossil fuel reserves.

According to a statement that was issued by the Special Assistant, Press to the Senate President, Tabiowo Ezrel, this disclosure was made by Lawan, while declaring open a 2-day public hearing on the bill by the National Assembly on Monday, January 25, 2021.

The Senate President pointed out that the National Assembly in its consideration of the piece of legislation would ensure that the bill when passed into law, guarantees improved revenue earnings for the country.

What the Senate President is saying

Lawan in his statement said, ‘’Let me say this, we (National Assembly) will pass this bill not without ensuring that it is a bill that satisfies certain conditions. Nigeria is blessed with these resources, we want Nigeria to benefit optimally from them. In fact, we are in a hurry because we have lost so many years of benefits that we could have had.’’

He, however, noted that the non-passage of the PIB had been a major drag on the industry over the years, significantly limiting its ability to attract both local and foreign capital at a time when many other countries are scrambling to exploit their oil and gas resources.

Going further, Lawan said, ‘’The mere knowledge that the nation’s oil industry is still being governed by laws enacted more than 50 years ago is ludicrous and extremely disappointing.

‘’As legislators, we will strive to deliver a Bill that will enhance the growth of our oil and gas industry, modernize our fiscal system and enhance competitiveness, while creating harmony for all stakeholders. This is a promise we have made and that we shall achieve.’’

‘’Nigeria must have an oil and gas industry that benefits its people. Equally, our oil and gas industry must be competitive. We must create a sustainable investment climate, where business in the sector will flourish,’’ he said.

He also added that the determination by the legislature to pass the Bill is driven by the need to overhaul a system that has refused to operate optimally in line with global standards, resulting in loss of continental competitiveness, transparency, accountability, good governance and economic loss for the petroleum industry and the country.

The Different chapters of the PIB

The Senate President revealed that the PIB comprises of 4 chapters that outline;

• How to create efficient and effective governing institutions with clear and separate roles for the petroleum industry,
• Establish a framework for the creation of a commercially oriented and profit-driven National Petroleum Company,
• Promote transparency, good governance and accountability in the administration of the petroleum resources of Nigeria among others.

Other benefits of the PIB

He also noted that the PIB upon passage and assent into law by the President;

• Would foster sustainable prosperity within host communities, provide direct social and economic benefits from petroleum operations to host communities,
• Create a framework to support the development of host communities among others
• Establish a progressive fiscal framework that encourages investment in the Nigerian Petroleum Industry,
• Balancing rewards with risk and enhancing revenues to the Federal Government of Nigeria,
• Provide a forward-looking fiscal framework that is based on core principles of clarity, dynamism and fiscal rules of general applications,
• Establish a fiscal framework that expands the revenue base of the Federal Government while ensuring a fair return to investors.

Lawan assured that the National Assembly during the public hearing would deal with all issues relating to the oil and gas industry with thoroughness and effectiveness so as to avert colossal losses to the nation’s economy.

Lawan: PIB will ensure Nigerians benefit optimally from resources

***As Senate begins public hearing on bill pic.twitter.com/nSycKWW4lH

— President of the Senate (@SPNigeria) January 25, 2021

ExxonMobil has lifted a force majeure on Nigeria’s Qua Iboe crude oil export terminal, as crude exports resume for the first time in almost six weeks after a fire at the terminal halted operations.

This is according to a company spokesman yesterday, who confirmed the company had lifted force majeure on Qua Iboe crude loadings.

Qua Iboe production started to ramp up to normal levels of 200,000 b/d in the past week, according to sources, with the release of both the February and March loading programs.

READ: Shell declares force majeure, to stop Bonny Light crude oil export 

The VLCC Dalia was also in the process of loading a 1-million-barrel stem at the Qua terminal since January 21, 2021, according to data intelligence firm Kpler. This will be the first export of Qua Iboe since December 15, 2020, after a fire hit the facility and injured two workers.

The company has been under pressure since the closure and prices have taken a hit as a result of the disruption. S&P Global Platts last assessed the grade at a discount to Dated Brent of 50 cents/b, down from a premium against the benchmark in December.

Bonny Light, a mainstay Nigerian crude which typically trades at roughly the same level as Qua Iboe, was last assessed 30 cents/b higher.

READ: Nigeria’s crude oil export suffers due to force majeure declared by Shell, others

What they are saying

One trader said: “If you get a cargo of Qua now it could be 50 cents to a dollar below Bonny even – a January cargo is completely out of cycle and the reliability issues mean people won’t touch it.”

Another trader stated that: “[The return of Qua Iboe] is not what West African crude assessments (WAF) differentials needed.”

READ: Nigeria faces breaking point as India’s global crude oil demand drops by 70%

What you should know

• Qua Iboe is one of Nigeria’s largest export grades, and is very popular among global refiners, with India, the US, Canada, Italy, Spain, Indonesia, and the Netherlands being key buyers.
• Qua Iboe is light sweet crude, which has a gravity of 36 API and sulfur content of 0.13%. The crude, produced from fields 20-40 miles off the coast of southeast Nigeria, is brought to shore at the Qua Iboe terminal via a seabed pipeline system.
• Indian demand has steadied following a buying spree late last year, and European demand has been hit by renewed coronavirus lockdowns in the region.
• Prices for Nigerian crude have suffered in recent weeks, even with lower supply due to the outage.
• February and March loading programs have been issued for Qua Iboe averaging 169,643 b/d and 153,226 b/d respectively.
• Production of this key grade ranged between 180,000-220,000 b/d in 2020, according to S&P Global Platts estimates.

READ: GenCos to halt supply if NBET insists on new service charge 

Prosecutors at the Milan Court holding a trial for the $1.3 billion Malabu oil field sale have demanded that U.S bank JPMorgan present documents of a transaction as part of the corruption case regarding the sale of the oilfield.

This was revealed in a report by Reuters, as the court case over the sale of the oil field continues. Prosecutors claim that nearly $1.1 billion was stolen by Nigerian politicians and middlemen, with former oil minister, Dan Etete, keeping half.

Prosecutors demanded that the Milan court accept emails sent by UK authorities, coming from a separate case launched by the Nigerian government against the bank for its role in the controversial deal.

READ: FG’s plan for N350 billion revenue from oil field licensing suffers setback

The emails include a transaction between Nigerian Attorney General Mohammed Adoke Bello and JPMorgan using the address of a company owned by another Nigerian named Aliyu Abubakar. Prosecutors allege that he paid $500 million in cash as part of a bribe.

Both men have also been charged for corruption relating to the deal, with both pleading not guilty.

READ: FG seizes Dan Etete’s luxury private jet linked to Malabu oil deal

The second email includes two JPMorgan executives expressing views on whether to transfer $1.1 billion to accounts related to Nigerian banks. The Milan prosecutors said the emails were valid, stating that a Swiss and Lebanese bank had also expressed doubts over the transaction.

The Milan court said it would make a decision over the emails on the 3rd of February. The verdict of the court case is expected to be announced in March 2020.

READ: Shell faces Dutch prosecution over Nigeria license

What you should know 

• Nairametrics reported that Dan Etete, former Nigerian Minister of Petroleum, said that the $1.3 billion sales of Malabu oil field to Shell and Eni in 2021 was legally perfect, with zero traces of corruption in the deal.
• Royal Dutch Shell announced that it would write down its investment in the controversial Malabu OPL 245 offshore field in Nigeria.
• Malcolm Brinded, an ex-Upstream Chief of Shell Petroleum, told international prosecutors that the sum of $1.3 billion paid by Shell and Eni in 2011 to acquire OPL 245 offshore field was lawful, and he had no reason to think it was illegal.
• A lawsuit filed by the Nigerian government against US bank JPMorgan Chase, claiming over $1.7 billion for its role in a disputed 2011 Malabu oil deal, will proceed to trial. The six-week trial in London is expected to commence on the first available date after November 1 2021, meaning that proceedings may not begin until 2022.