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AfrOil COMMENTARY AfrOil

Sylva did not divulge further details of these ini- government revenues from oil and gas projects
tiatives, but Punch reported on October 6 that it and with minimising waste.
had seen a copy of the PIB. The bill provides for NMDPRA, meanwhile, will oversee the tech-
NNPC’s current responsibilities to be divided nical and commercial regulation of midstream
between three new entities, and one of these will and downstream oil and gas operations. It will be
Nigeria National Petroleum Co. Ltd (NNPC responsible for ensuring that infrastructure for
Ltd), the new commercial operator, it said. midstream and downstream activities is devel-
The newspaper went on to say that the legis- oped and maintained in an efficient, safe and
lation called for NNPC Ltd to be incorporated as sustainable manner. Additionally, it will advise “
a limited liability company within six months of government agencies and other participants in Although Abuja
the signing of the new law. Nigeria’s Ministry of the sector on commercial matters related to tar-
Petroleum Resources will consult with the Min- iff and pricing regimes. does not appear
istry of Finance to determine the number and
nominal value of shares in the new company, Infrastructure investments to have plans
and all of these shares will be assigned to Nige- According to Vanguard, another Nigerian to proceed with
ria’s federal government, it said. newspaper, NMDPRA will not be the only
In turn, federal authorities will be respon- state agency involved with infrastructure. The privatisation any
sible for covering the costs associated with the PIB also aims to establish an entity to promote
transformation of NNPC’s existing structures, it domestic gasification. time soon, it has
added. Additionally, the federal government will This body, which will be known as the Mid-
have the power to veto any proposals for sale of stream Gas Infrastructure Fund (MGIF), will not ruled out a
shares in the new entity, NNPC Ltd. serve as a vehicle for investment in midstream sale of shares in
On that note, Abuja does not appear to have gas projects. More specifically, it will give the
any plans to privatise the company any time federal government a means of investing in pro- NNPC Ltd
soon. Even so, Bloomberg reported that the PIB jects designed to expand domestic distribution
did not rule out an equity sale. It said that the and consumption of gas. Since it will be able to
legislation called for any future sale or transfer buy into schemes that are led by private com-
of shares to be carried out at a fair market value panies, officials in Abuja hope it will encourage
and via an “open, transparent and competitive private-sector investment in gas transportation
bidding process.” and distribution infrastructure.
The bill also makes other provisions for Vanguard did not say how much MGIF might
transparency, the news agency added. Specifi- be able to contribute to midstream gas projects.
cally, it calls for NNPC Ltd to be subject to an It did report, though, that the PIB called for the
annual audit by an independent firm. (This defi- new entity to receive up to 1% of the proceeds of
nitely represents a departure from the past, as a new levy on wholesale petroleum product and
NNPC has been notorious for its questionable gas sales within Nigeria. Additionally, it cited
accounting practices and lack of transparency.) the legislation as saying that most of MGIF’s
funding would come from “funds and grants
Upstream, midstream and downstream accruing from multilateral agencies, bilateral
Meanwhile, Punch said, the other two new institutions and related sources.”
bodies – the Nigerian Upstream Regulatory This new entity will apparently have some
Commission (NURC) and the Nigerian Mid- measure of independence from Abuja. It will not
stream and Downstream Petroleum Regulatory report directly to any particular state agency, and
Authority (NMDPRA) – will be government its day-to-day operations will be overseen by an
agencies. executive director who need not be a govern-
According to the legislation, NURC will be ment official.
responsible for the technical and commercial Nevertheless, its governing council will be
regulation of upstream oil and gas operations. chaired by the Minister of Petroleum Resources
It will also be tasked with ensuring compli- and will also include high-ranking representa-
ance with all relevant laws and regulations tives of the Central Bank of Nigeria (CBN), the
covering upstream activities, with optimising Ministry of Finance and NMDPRA. ™

Total: Oil demand to peak in 2030

Faced with gloomier prospects for oil, the French giant is doubling down on gas and renewables

THE French oil major Total has joined other oil This represents a more bullish forecast than
companies predicting that peak oil demand will that of UK peer BP, which recently warned that
arrive in the coming decade, forecasting an end oil consumption would peak in the early 2020s,
to consumption growth in 2030. if it has not done so already.

Week 40 07•October•2020 www. NEWSBASE .com P5