The Nigeria Extractive Industries Transparency Initiative (NEITI), has identified conditions to be met in the new Petroleum Industry and Governance Bill (PIGB), for the proposed legislation to meet the expectations and challenges of the industry.
The Executive Secretary of NEITI, Waziri Adio listed these conditions in a paper presented at a Stakeholders’ Dialogue on the PIGB organized recently in Abuja, by the Civil Society Legislative Advocacy Centre, CISLAC.
One of the conditions identified by NEITI was the issue of institutional disclosure through regular reporting. Mr.Adio noted that ''The current NEITI audit reports rely on annual data collection exercise undertaken by the independent auditors to generate information about transaction in the industry for the preceding year. Apart from the delay with industry-wide physical data collection, the system creates a serious lag in dissemination, limits engagement and weakens accountability.'' He called for a provision in the PIGB to compel companies and government agencies to make information and data available in real time in a format that can be easily accessible.
The second condition identified by the Executive Secretary, was the need for the PIGB to provide for relevant government agencies and organizations in the extractive industry, to comply with relevant sections of the NEITI Act.
He also listed, the removal of impediments currently being faced by the civil society for effective engagements with the industry, as another area that should be boldly addressed by the PIGB.
‘’We recognize that information not specifically listed for the purpose of NEITI audits, or which may not be contained in companies periodic reports, may however be sought by civil society actors for the overall purpose of transparency and accountability in the oil and gas sector. I therefore recommend that the requirement for disclosure should address ambiguities by any other law that exempts or purports to exempt the national oil company from compliance with the Freedom of Information Act.’’
The NEITI Executive Secretary added that right incentives and protection for industry personnel, to expose wrongdoing in the sector in the interest of the public, should be provided for in the new PIGB.
'‘The cardinal requirements of accountability is that the one holding to account must be independent of the one being held to account. This is why the EITI standard requires that implementing countries, must disclose the relationship that exists between state-owned extractive companies and the government. To fully implement the EITI requirements, it is recommended that the PIGB should ensure sufficient delineation of structure, authority and responsibilities of the national oil company, the regulator and the Ministry of Petroleum Resources.’’
Adio, underlined that no company or agency created under the PIGB should be exempted from the Fiscal Responsibility Act 2007 and the Public Procurement Act 2007. He argued that these legislations positively affect the operations in oil & gas sectors given provisions for open, competitive and cost-effective public procurement and stringent financial guidelines, for public expenditure management.
Mr. Adio also identified mandatory contract disclosure of companies operating in the oil & gas sector as another important feature that the PIGB should not ignore, in line with the global trends. He maintained that the PIGB should provide an opportunity to address the issue of beneficial ownership, by ensuring that natural persons who directly or indirectly ultimately own or control the corporate entity, are publicly disclosed.
The paper contended that the PIGB should include sanctions for failure to comply with the requirement of the extant laws. He emphasized that the PIGB should specify relevant penalties for non-compliance with the provisions of the NEITI Act, Fiscal Responsibility Act and Public Procurement Act, and should clearly designate the prosecuting authorities.
Waziri Adio explained that it is necessary to ensure that the new law does not retain any provision that tends to grant officials the power to unilaterally, or discretionally take decisions with regards to issuance of licenses, title and control of national stakes in oil assets. He warned that decisions that fundamentally undermine the accountability objectives of the law should not be encouraged.
The stakeholders’ dialogue was organized by the Civil Society Advocacy Centre to generate diverse ideas that will help government and the National Assembly in improving the content of the proposed Legislation.