PENGASSAN Faults Tinubu’s Oil Revenue Executive Order, Says It Violates PIA Provisions

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has faulted President Bola Ahmed Tinubu’s Executive Order on Oil and Gas Revenue Remittance, saying certain provisions of the Order and calculations were wrong and would create more instability in the oil sector.

Addressing the media in Lagos on Thursday, PENGASSAN president, Festus Osifo, said the President was wrongly advised into signing the Order of which its provisions clearly violates the Petroleum Industry Act (PIA) and the outcome will further frustrate investment in the industry.

Osifo, said the haste in signing and gazetting the Order would create more problem for the sector and discourage potential investors.

He argued that the Presidential Executive Order, which has officially been gazetted, states that NNPC Limited will no longer collect and manage the 30 per cent Frontier Exploration Fund.
According to the EO, the NNPC Limited will ensure that the 30 per cent profit from oil and gas from production sharing, profit sharing, and risk service contracts currently earmarked for the frontier exploration fund is henceforth transferred to the Federation Account.

However, Osifo, posited that under the Frontier Exploration Fund is domiciled outside NNPCL.

He said the EO, has set a wrong precedent and will create uncertainties in the minds of investors who will have the thinking that the government can wake up one day and increase royalties and taxes which will eventually rob on their Return on Investment (RoI).

Osifo, called for immediate reversal of the Order and demanded a broader stakeholder engagement to review the policy, stating that the Order clearly shows that political interference in the company is strongly manifest.

According to him, the Association nor other key industry partners were not involved in the decision process.

He said the Association earlier learnt that there will be an Executive Bill where all issues will be discussed and addressed through public hearing and while they are preparing their position paper the announcement was released to their utter disregard.