Operators in the Nigerian oil industry Wednesday condemned the failure of the parliament to pass a key legislation intended to overhaul the country's petroleum industry, despite assurances from lawmakers they would pass the bill before the end of their term of office.
The two chambers of the National Assembly have formally admitted that the Petroleum Industry Bill cannot be passed, and that it will be dealt with by the incoming parliament, lawmakers said Wednesday.
But industry operators said the development meant prolonging the delay in the oil reform bill becoming a law because a new set of lawmakers would require more time to study the bill.
"It is a terrible situation, a real setback for the industry," a senior official of the state-owned Nigerian National Petroleum Corp. told Platts.
"It is a monumental waste considering the energy, time and resources NNPC committed to ensuring that the bill was passed into law before now," said the official who asked not to be named.
An official of a western oil company said that apart from a halt in investment in Nigeria's oil sector, the failure to pass the PIB could trigger another crisis in the main oil-producing region, the Niger Delta.
"The PIB was expected to address the key issues creating conflicts in the Niger Delta, to compliment the government amnesty program. But as it is now, the people in the region may think other parts of the country are unwilling to address their demands," the official said.
The bill, which had been with the parliament since 2008, seeks to transform the NNPC, long hampered by funding problem, into a five new profit-oriented entities.
Nigeria also hopes the PIB will tackle issues including funding shortfalls at its joint ventures with foreign firms, insecurity in the Niger Delta, increasing local involvement in the industry and production of more gas for domestic power.
But the bill has suffered several setbacks following repeated amendments due to strong protests from Nigeria's foreign oil joint venture partners on grounds that its original provisions would hurt their investments.
Oil Minister Diezani Alison-Madueke said May 20 that lawmakers had given their word that the bill would be passed before May 29, this year.
But a spokesman for the upper chamber Senate said this did not materialize. "Everything about the PIB has been suspended till the next session [of parliament]," he said.
The local Vanguard newspaper also reported on Wednesday that the lower chamber House of Representatives also finally stopped considering the bill.
