Dis­cre­tionary al­lo­ca­tions sti­fling oil in­dus­try’s growth – Ezek­we­sili

The Punch - - BUSINESS & ECONOMY - ‘Femi Asu

Aformer Min­is­ter of Solid Min­er­als, Dr. Oby Ezek­we­sili, has said the dis­cre­tionary award of oil li­cences is bring­ing about medi­ocrity in the na­tion’s oil and gas in­dus­try and sti­fling its growth.

She stated this in La­gos on Mon­day at the first Na­tional Ed­u­ca­tion Sum­mit or­gan­ised by the Oil and Gas Train­ers As­so­ci­a­tion of Nige­ria to tackle the chal­lenges and ex­plore the prospects of sus­tain­ing lo­cal con­tent through qual­ity ed­u­ca­tion and train­ing.

The for­mer Ed­u­ca­tion min­is­ter, who chaired the event, noted that the Lo­cal Con­tent Act was aimed at de­vel­op­ing lo­cal ca­pac­i­ties and com­pe­ten­cies in the oil in­dus­try.

She said, “One of the things that NEITI (Nige­rian Ex­trac­tive In­dus­tries Trans­parency Ini­tia­tive) en­trenched in the oil and gas in­dus­try was the idea that we must avoid dis­cre­tionary al­lo­ca­tion of the right to ex­plore for oil in the coun­try.

“The dis­cre­tionary al­lo­ca­tion sys­tem led to medi­ocrity, in­com­pe­tence and the sti­fling of the sec­tor. That dis­cre­tionary prac­tice was the har­bin­ger of grand cor­rup­tion in this coun­try.”

The Petroleum Act, 1969 (as amended), gives full au­thor­ity or dis­cre­tion to the Min­is­ter of Petroleum to grant li­cences for the ex­plo­ration, prospect­ing and min­ing of oil, and em­pow­ers the Pres­i­dent to “cause the farm-out of a mar­ginal field” if it has been left unat­tended for a pe­riod of not less than 10 years from the date of its first dis­cov­ery.

Ezek­we­sili said the sys­tem of auc­tion­ing and li­cence op­tions were en­trenched to put an end to dis­cre­tionary al­lo­ca­tions.

Not­ing that the mar­ginal fields pro­gramme was meant to ex­pand lo­cal par­tic­i­pa­tion in the in­dus­try, she stated, “I re­call how it was at that time that peo­ple who were in pol­i­tics as­sumed mar­ginal fields and were sim­ply go­ing to be dis­trib­uted to all who clapped at the vil­lage square.

“But hav­ing en­trenched the prin­ci­ple of trans­parency through NEITI, we sim­ply said ‘no, this isn’t go­ing to be’. Be­cause if you look at your lo­cal con­tent as your prebends for set­tling your po­lit­i­cal elite, then what you do is that you kill a tech­ni­cal sec­tor on the al­tar of pol­i­tics.”

“I pray that our lo­cal con­tent pol­icy will not suf­fer sti­fling sim­ply be­cause it is not an­chored on the ob­vi­ous vi­sion, which is that eco­nomic im­pact of the sec­tor be ex­tended be­yond the op­er­a­tors, who have con­nec­tions of one kind or the other, to peo­ple who hold high po­lit­i­cal of­fices.”

The Group Man­ag­ing Di­rec­tor, Nige­rian Na­tional Petroleum Cor­po­ra­tion, Dr. Maikanti Baru, called on rel­e­vant stake­hold­ers to sup­port the academia by col­lab­o­rat­ing with it to fos­ter eco­nomic growth and de­vel­op­ment in the coun­try.

he said the oil in­dus­try could of­fer a route to max­imise the use of in­no­va­tive ideas of the academia through the trans­fer of tech­nol­ogy and to aug­ment the re­quired in­vest­ment sup­port of the academia.

Baru stated, “Nige­rian academia and the oil and gas in­dus­try are in­creas­ingly find­ing it mu­tu­ally ben­e­fi­cial to col­lab­o­rate, but there is still a lot to be achieved in this re­gard.

“There­fore, the need for the Nige­rian academia to ad­just their sys­tem and give cre­dence to re­search and in­no­va­tion so as to at­tract in­vest­ment of the oil and gas in­dus­try can­not be overem­pha­sised.”

The Pres­i­dent, OGTAN, Dr. May­owa Afe, noted that progress had been made to­wards lo­cal con­tent de­vel­op­ment, cit­ing the Egina Float­ing, Pro­duc­tion, Stor­age and Of­fload­ing unit as an ex­am­ple.

he said crit­i­cal stake­hold­ers were as­sem­bled to help pro­vide new in­sights and so­lu­tions to “the ever-con­stant is­sues and chal­lenges fac­ing our ed­u­ca­tion sys­tem, thereby mak­ing our grad­u­ates em­ploy­able in the oil and gas in­dus­try af­ter grad­u­a­tion.”

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