News / Africa

Nigerian Parliament Debates New Oil Law for Africa's Top Producer

Nigeria's new acting president and commander in chief Goodluck Jonathan is pictured as he takes office in Abuja, 10 Feb 2010
Nigeria's new acting president and commander in chief Goodluck Jonathan is pictured as he takes office in Abuja, 10 Feb 2010



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.

You May Like

Video Russia’s Syrian Escalation Tests Obama’s Crisis Response

Critics once again question whether president has been slow to act on Syrian conflict, thus creating opening for powers like Russia More

Ancient African DNA Shows Mass Migration Back Into Africa

First genetic analysis of ancient human remains in Africa suggests massive migration from north around time of Egyptian empire More

NASA: Pluto Has Blue Sky

New photos also reveal the presence of water ice More

This forum has been closed.
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Hungary Criticized for Handling of Refugeesi
Henry Ridgwell
October 08, 2015 8:02 PM
Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Hungary Criticized for Handling of Refugees

Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Iraqi-Kurdish Teachers Vow to Continue Protest

Sixteen people were injured when police used tear gas and rubber bullets to disperse teachers and other public employees who took to the streets in Iraq’s Kurdish north, demanding their salaries from the Kurdish Regional Government (KRG). VOA’s Dilshad Anwar, in Sulaimaniya, caught up with protesting teachers who say they have not been paid for three months. Parke Brewer narrates his report.

Video Syrian Village Community Faces Double Displacement in Lebanon

Driven by war from their village in southwestern Syria, a group of families found shelter in Lebanon, resettling en masse in a half-built university to form one of the biggest settlements of its kind in Lebanon. Three years later, however, they now face being kicked out and dispersed in a country where finding shelter as a refugee can be especially tough. John Owens has more for VOA from the city of Saida, also known as Sidon.

Video Bat Colony: Unusual Tourist Attraction in Texas

The action hero Batman might be everyone’s favorite but real bats hardly get that kind of adoration. Put more than a million of these creatures of the night together and it only evokes images of horror. Sarah Zaman visited the largest urban bat colony in North America to see just how well bat and human get along with each other.

Video Device Shows Promise of Stopping Motion Sickness

It’s a sickening feeling — the dizziness, nausea and vomiting that comes with motion sickness. But a device now being developed could stop motion sickness by suppressing certain signals in the brain. VOA’s Deborah Block reports.

Video Making a Mint

While apples, corn, and cranberries top the list of fall produce in the US, it’s also the time to harvest gum, candy, and toothpaste—or at least the oil that makes them minty fresh. Erika Celeste reports from South Bend, Indiana on the mint harvest.

Video Activists Decry Lagos Slum Demolition

Acting on a court order, authorities in Nigeria demolished a slum last month in the commercial capital, Lagos. But human rights activists say the order was illegal, and the community was razed to make way for a government housing project. Chris Stein has more from Lagos.

Video TPP Agreed, But Faces Stiff Opposition

President Barack Obama promoted the Trans-Pacific Partnership on Tuesday, one day after 12 Pacific Rim nations reached the free trade deal in Atlanta. The controversial pact that would involve about 40 percent of global trade still needs approval by lawmakers in respective countries. Zlatica Hoke reports Obama is facing strong opposition to the deal, including from members of his own party.

Video Ukranian Artist Portrays Putin in an Unusual Way

As Russian President Vladimir Putin was addressing the United Nations in New York last month, he was also being featured in an art exhibition in Washington. It’s not a flattering exhibit. It’s done by a Ukrainian artist in a unique medium. And its creator says it’s not only a work of art - it’s a political statement. VOA’s Tetiana Kharchenko has more.

Video Nano-tech Filter Cleans Dirty Water

Access to clean water is a problem for hundreds of millions of people around the world. Now, a scientist and chemical engineer in Tanzania (in East Africa) is working to change that by creating an innovative water filter that makes dirty water safe. VOA’s Deborah Block has the story.

Video Demand Rising for Organic Produce in Cambodia

In Cambodia, where rice has long been the main cash crop, farmers are being encouraged to turn to vegetables to satisfy the growing demand for locally produced organic farm products. Daniel de Carteret has more from Phnom Penh.

Video Botanists Grow Furniture, with Pruning Shears

For something a bit out of the ordinary to furnish your home, why not consider wooden chairs, crafted by nature, with a little help from some British botanists with an eye for design. VOA’s Jessica Berman reports.

VOA Blogs