Africa Press-Nigeria:
Delay in passing the reform legislation and the resulting fiscal uncertainty had led to a raft of divestment by foreign oil companies, he said.
Kyari called for the new law to enshrine a clear separation of roles between industry operators and regulators, and questioned the over-hasty manner in which local content had been pursued in the oil and gas sector.
He urged lawmakers to review the lessons learned since the inauguration of the Nigerian Content Development Monitoring Board (NCDMB), arguing that the burden of implementation may have driven up operating costs and made Nigerian industry uncompetitive.
Uncertainty has wrecked upstream growth prospects in Nigeria with international investors fast-losing confidence in the government’s will to overhaul the industry, according to Nigerian National Petroleum Corporation managing director Mele Kyari.
Addressing the National Assembly’s House of Representatives’ Petroleum Resources (Upstream) Committee yesterday, Kyari urged swift passage of the Petroleum Industry Bill (PIB) in order to attract capital, strengthen cost recovery and ensure decent returns on investment.
“You cannot but rely on foreign investment if you want to grow; we have seen the cost of local content shoot up in the last 10 years, magnifying the cost of doing business in Nigeria,” Kyari said.
“We need to review the premium we wish to place on Nigerian content and conduct a thorough cost-benefit analysis before new regulations are drawn up because current rules operated by the NCDMB have adversely impacted competition,” he argued.
The cost of doing business in Nigeria is too high while the one-size-fits-all administrative levies charged by the NCDMB are also too high, he said.
Kyari’s remarks follow the expression of similar sentiments by industry leaders in recent days as the PIB heads for debate in the National Assembly.
Chchi Emenike, head of gas ventures for the Neconde Consortium, the high-profile indigenous operator of Shell-divested acreage in the Niger Delta, said only “speedy passage of the PIB will encourage more investors into the oil and gas space; investors are simply not taking decisions and will not unless they see their investments can be secured.” (Copyright)
