Nigeria's parliament is debating a new oil law that foreign companies say could drive away billions of dollars in future investment. The government's petroleum ministry says it will recoup hundreds of millions of dollars in lost tax.
The Petroleum Industry Bill before Nigeria's parliament allows the government to renegotiate old contracts, increase costs for oil companies and reclaim land that is not yet explored.
Since taking temporary power last month, Nigerian Acting President Goodluck Jonathan has made the petroleum bill one of his main legislative priorities, saying quick passage is vital to national interest.
"Nigeria's resources, whether cobalt in the Mabela plateau or the Niger Delta Basin, should be used for the advancement of the Nigerian people. We must collectively take those steps that would protect our inheritance, even as we work with our foreign partners in the advancement of humanity," Jonathan stated.
Nigeria's petroleum ministry says the new law will recoup nearly $300 million a month in lost tax revenue. But oil firms say it will make future exploration in Nigeria unprofitable, driving away investment in Africa's biggest petroleum producer.
Ann Pickard is the regional executive vice president for the Shell Oil Company. "The bill as we have seen it, $50 billion will not be invested that would have been invested. That money will go elsewhere. Nigeria can not afford to lose those years or those projects. Nigeria needs cash to invest in infrastructure development. Nigeria needs cash to grow its domestic gas business. Delay will derail government vision 2020-20, and means Nigeria will lose competitive momentum," Pickard explained.
Nigerian oil and gas production has fallen by more than one-quarter since 2005, largely because of a rebellion in the oil-rich Niger Delta. The area is now slowly returning to normal, since thousands of fighters accepted an amnesty offer, six months ago.
Acting President Jonathan says he is working to secure the gains of that amnesty and better share the profits of Nigeria's oil wealth with people in oil-producing regions.
But uncertainty about peace in the Niger Delta has led to greater investment in offshore fields that are less vulnerable to sabotage. Foreign firms say that is threatened by legislation that they say would make Nigeria one of the world's harshest climates for oil investment.
Shell Oil's Pickard agrees there must be changes in the way Nigeria's oil sector is run, but she says not all of those changes are best dealt with in legislation. "What you have to deal with in the legislation, deal with in the legislation," he said. "If you can deal with regulation, deal with the regulation. So deal with the right pieces."
At a time when Angola is threatening to take the top spot in African production, Pickard says Nigeria can not afford to make mistakes that will take years to correct.
Ibrahim Mark is the general secretary of the Nigerian Bar Association. He says the country needs changes that protect both Nigeria's economy and outside investment.
"They now know that there are ways of dealing in business in Nigeria that are transparent. There is a way to always have a great return on investment. Because a man who is investing does not want to invest and see his investment go away. He must be sure that whatever he is meeting today will be there for the next 10, 20 years," Mark said.
Lawmakers here say they have a good bill that -- coupled with stability in the Niger Delta -- will boost government revenues. The bill breaks up the old state-run oil company into smaller, profit-driven units better able to tap international capital markets.
Members of parliament say Nigeria's take of oil revenue will still be less than Angola or Ghana, and the bill will keep more of the money invested here in Nigeria. The government says 80 percent of oil investment now ultimately ends up outside the country.