Buhari’s Imprints on the Nigerian Oil and Gas Sector
By Salisu Na’inna Dambatta
The signing of the Petroleum Industry Bill (PIB) into law by President Muhammadu Buhari on August 16th, 2021, after it was passed by the National Assembly, has added yet another Buhari signature on the Nigerian Oil and Gas sector.
Equally, the Presidential assent which turned the Bill into Petroleum Industry Act (PIA) of the National Assembly has placed Muhammadu Buhari tops among Nigerian leaders that made the most impact in transforming the country’s hydrocarbon endowment into a resource with economic value.
For it can be recalled that Muhammadu Buhari was privileged to have served as Nigeria’s Federal Commissioner for Petroleum and Natural Resources (Minister of Petroleum) from 1976 to 1978 and doubled as Chairman, Nigerian National Petroleum Corporation from 1977 to 1978. His tenures in the two posts were action-packed as the government implemented landmark projects in the development of the Oil and Gas sector.
As Commissioner for Petroleum and Natural Resources he re-organised the industry and bolstered the capacity of the NNPC to locally refine and deliver petroleum products to Nigerians more efficiently by building essential facilities for that purpose. Hitherto Nigeria was refining crude oil in several countries including nearby Ghana and Ivory Coast.
Among the facilities built were 23 storage depots for petroleum products. They were strategically located in parts of the country. The Ministry of Petroleum and Natural Resources under his stewardship constructed pipeline networks linking the four refineries to the depots. The building of two new refineries located at Kaduna and Alesa Eleme were started while he was the Minister and Chairman of the NNPC.
Some scholars have described the network of 5,120 kilometres of pipelines constructed by Muhammadu Buhari in his days as Commissioner for Petroleum and Natural Resources as a mesh that interlinks to 23 storage depots; 8 Liquefied Petroleum Gas depots; 24 pump stations; the 4 refineries; 2 offshore jetties, the Atlas Cove and Escravos; and 4 onshore jetties at Apapa, Calabar, Okrika and Warri.”
The scholars explained further: “the Pipeline and Product Marketing Company (PPMC) of the Nigeria National Petroleum Corporation transports crude oil to the refineries in Port-Harcourt, Warri and Kaduna, a total distance of 719 kilometres” using the pipelines.
With that history of Muhammadu Buhari’s contribution to the development of the Oil and Gas industry in the late 1970s, and the serious transformative initiatives he initiated and implemented to boost the sector from May 2015 when he took office as President of Nigeria and Minister of Petroleum Resources in an administation led by members of All Progressives Congress (APC), and the signing of the PIB into law in August 2021, his bold imprints on the industry are indelible.
The PIA is significant because it promises to generate multiple outcomes the main one being converting the NNPC into a Limited Liability Corporation in line with some of its counter parts in other oil-rich countries. In those countries the process of oil prospecting licensing are transparent with less middlemen; adequate refining capacity is the norm while massive sabotage of industry installations are alien.
By making the private sector the main driver of the industry, it is believed that the country will earn more from the oil and gas through a more efficient running of the industry and less political interference. There are sections and clauses in the Act that guide operators on cleaning spillage and clear methods of settling disputes in the industry. It gives opportunities to both local and international oil companies to participate in the sector. This can lead to the expansion of the industry as more players come in, pouring money for exploration and actual development of prospecting areas.
By breathing life into the PIA and the immediate creation of its implementation committee, President Muhammadu Buhari has achieved his promise to reform and implement measures that can boost our national income from the oil and gas industry. He made the promise on June 30, 2015 in two different meetings he held with representatives of ExxonMobil and the Nigerian Natural Liquefied Gas (NNLG) respectively. The promise includes the removal of bureaucratic bottlenecks occassioned by multiple government agencies that currently impede the operations of companies in the oil and gas sector.
The President’s promise also include giving priority to the security of oil and gas installations and enhancing maritime security: It is the responsibility of the Federal Government to secure the environment. The vandalism of oil installations and pipelines, piracy, oil theft and the fall in the international price of oil have made our economic situation very disturbing. This government will do all within its powers to secure the environment and encourage more investments in the oil sector, President Buhari said.
Implementing the PIA assiduously is one of the instruments for achieving that.