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Senate to Review Law on Oil Production Sharing Contract

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The Senate has mandated its Committee on Petroleum Resources Upstream to come up with a bill on amendment of the Inland Basin Production Sharing Contract (PSC) Act.
This followed the adoption of a motion by Sen. Ifeanyi Ubah, (YPP Anambra) and 30 others at Wednesday’s plenary.


The motion was on the urgent need to review Production Sharing Contract (PSC) in line with section 16 of the deep offshore and inland Basin Production Sharing Contract Act CAP D3 LFN 2004 and amend the extant Act.

Moving the motion, Ubah said the committee on petroleum resources upstream had been inundated with petitions and complaints on the PSC.
He said Federal Government over the years had lost billions of dollars in potentially accruable revenue due to non-review and amendment of the salient provisions of the PSC Act.

He said in spite of huge contributions of the PSC to total oil production, the contributions of revenue per barrel of PSC for federal government’s take had been significantly low.
This, he said was because of the inherent inequitable terms in the PSC and failure to review the salient provisions of the act.
According to him, PSC Act provides that where the price of crude oil exceeds 20 dollars per barrel, the Act will be reviewed to ensure that federal government share in the additional revenue is adjusted.
He also said that the act provided that it may be reviewed after 15 years from the date of its enactment in 1993 and every five years thereafter.
According to him, the non- review of the Act over the years had led to loss of 21 billion dollars to Nigeria.
He said Nigeria stand to gain additional N30 billion monthly if the Act is reviewed and amended.
This, Ubah said would boost the nation’s revenue profile.
Contributing, Sen. George Sekibo, (PDP-Rivers), said the PSC was an additional opportunity for Nigeria to make money, adding that there was an urgent need to review the Act.
He said cabals in the oil sector were frustrating attempts to review the Act over the years.
Other senators, who supported the review, were Stella Oduah, Rochas Okorocha, Adamu Alerio, Gabriel Suswam among others.
The senate in its resolution also mandated its committee on petroleum resources upstream to investigate reasons for failure to review the Act over the years.
In his ruling, President of the Senate, Dr Ahmad Lawan said the bill for the review of the Act would be presented for second reading in the next legislative day.
He urged the senate to give the PSC amendment bill expeditious debate and passage when presented.
He maintained that the bill if passed would help the country to generate fund to support execution of the budget.
The News Agency of Nigeria (NAN), reports that PSC is a contractual arrangement for petroleum exploration and production.
This is whereby the state as owner of the petroleum engages a contractor to provide technical and financial services for exploration and production operations with agreed share in profit after payment of royalty, cost and tax.
The contractual agreements were offered by the federal government in 1991 leasing round and its terms codified into legislation.
Nigeria presently has seven oil fields from the 1993 PSCs.(NAN)
KC/AMM/ABI

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NSCDC Uncovers Illegal Bunkering Sites in Rivers Cemeteries

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The Nigeria Security and Civil Defence Corps has busted illegal crude oil refining sites at cemeteries in Abalama and Oproama Communities in Asari-Toru Local Government Area of Rivers State.

The security outfit said the feat was achieved by its Marine Anti-vandal Squad after a four hour operational tour on water across the two coastal communities.

Speaking to newsmen after the operation, the NSCDC spokesman, Rivers State Command, Superintendent Olufemi Ayodele, said its operatives successfully uncovered the illegal bunkering sites through credible and sustained intelligence.

Ayodele recalled that the NSCDC Commandant General, Dr Ahmed Abubakar Audi, gave a marching order to all formations in the Niger Delta to step up intelligence and operational efficiency in the fight against oil theft and illegal oil bunkering activities.

He expressed worry about how the miscreants devised a new means of converting cemeteries to illegal bunkering sites, saying they had already loaded several illegally refined crude and refined Automotive Gas Oil also known as diesel was sighted in boats by the riverside.

The state NSCDC image maker however said on sighting its operatives the hoodlums took to their heels though they were giving a hot chase, pointing out that men of the Marine Anti-Vandal Squad are on their trail to ensure they are arrested and prosecuted.

He stated, “Acting on this directive the Rivers State Commandant of the NSCDC, Basil Igwebueze, deployed the Marine Anti-vandal Squad to the crime scene where several boats filled with crude oil and refined Automotive Gas Oil were sighted.

‘This is the Abalama community and behind us is the Oproama community as well where Cemeteries were converted to illegal bunkering sites; Upon our arrival, the suspects took to their heels knowing the squad had superior firepower.

‘The NSCDC as an environmentally friendly agency condemns outright all acts of environmental pollution, degradation of aquatic life and economic sabotage.

“We have contacted some good people in the two communities and they are cooperating with us so that the perpetrators would be apprehended in due course. However, the quantities in litres of the locally refined AGO cannot be ascertained.”

He added, “Consequently, the NSCDC Rivers State Command helmsman has further issued a stern warning against the activities of vandals and illegal bunkers in the state affirming that the fight against oil theft is a relentless war and suspects arrested with their sponsors would be made to face the full wrath of the law.”

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Energy and Power

Oil, Electricity Workers’ Unions Mobilise for Planned Strike

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The Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) has directed its members to comply with the directive of the two labour centres to begin an indefinite nationwide strike on Monday.

Its General Secretary, Mr Afolabi Olawale, in a statement on Saturday, said the union was committed to ensuring total compliance with the directive.

Recall that the Nigeria Labour Congress (NLC) and Trade Union Congress of Nigeria (TUC) declared an indefinite nationwide strike to begin on Monday, to express their grievances over the proposed new minimum wage.

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In a joint statement signed by NLC President, Mr Joe Ajaero and TUC President, Mr Festus Osifo, the centres declared the strike over the tripartite committee’s inability to agree on a new minimum wage and the hike in electricity tariff.

Afolabi said the union was concerned and disturbed with the insensitive attitude of the federal government “to the very critical issue of negotiating a new minimum wage for Nigerian workers”.

“This is in view of the various socio- economic policies of this administration that have impoverished the working people of this country.

“Leaders of our great union at all levels, from the units, zones and branches, should immediately put all processes in place to ensure total compliance with this directive.”

Also, the National Union of Electricity Employees (NUEE) said it was mobilising its members to embark on the strike following the directive of NLC and TUC.

The Acting. General Secretary, Mr Dominic Igwebike, gave the directive to the members in a statement.

Igwebike said that along with the reasons of inconclusive negotiations on the minimum wage and electricity tariff hike, apartheid categorisation of Nigeria electricity consumers into bands was another, to embark on the strike.

“Given the above, all national, state, and chapter executives are requested to start the mobilisation of our members in total compliance with this directive to ensure the government does the right thing as stated above.

“The withdrawal of services becomes effective on Sunday 2nd June by 12.00 midnight, “ the union leader said. (NAN)

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Oil Theft: Navy Impound Three barges, Arrest Seven Suspects in Bayelsa

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The Nigerian Navy has impounded three barges laden with suspected stolen crude oil and refined Automotive Gas Oil (AGO) ,arresting seven, at Tunu Community Creek, in Ekeremor Local Government Area of Bayelsa.

The Commander, Nigerian Navy Ship (NNS) SOROH, Commodore Nanmar Lakan told the News Agency of Nigeria (NAN) on Saturday that his command received an intelligence report on the illegal activities going on in the area and swung into action.

NAN reports that the seven suspects who were found on board the barges who claimed to be security working under Tunu leadership are kept under custody pending when the investigation is concluded.

According to Lakan, Shell Petroleum Development Company (SPDC) has complained of the loss of 25 percent of their daily production in the area to oil thieves.

He said he swung into action by sending his men on both air and water surveillance in the area and their efforts paid off as the barges were impounded by his officers and men.

According to the Commander, two of the barges have the capacities of containing 637,000 litres of the products each while the third can contain 700,000 litres of the products.

Lakan added that investigation is ongoing to ascertain the owners of the barges and where the products were meant to be discharged.

He warned those who indulge in such illegal activities of oil theft to desist from such illegitimate business, as the Nigerian Navy will not allow them to find peace. (NAN)

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