– Petroleum regulatory bodies in Nigeria are expected to be scrapped by the petroleum ministry
– The bodies will be consolidated into a single agency
– The minister of petroleum is expected to be in charge of the new body and monitor policies
There is an air of upset in the oil sector following the plan by the government to scrap regulatory authorities including the Nigerian National Petroleum Corporation (NNPC), Department of Petroleum Resources (DPR) and Petroleum Products Pricing Regulatory Agency (PPPRA)
Vanguard reports that this was contained in the draft National Oil Policy document released by the Ministry of Petroleum Resources.
READ ALSO: NNPC increases price of fuel
The regulatory bodies will be unified into a single agency to be known as Petroleum Regulatory Commission (PRC).
The PRC will incorporate the activities of the existing petroleum regulatory authorities and will also cover some new regulatory activities not currently covered.
According to the document, the existing “framework was weak, largely ineffective and inefficient, arising from a number of single-issue agencies; overlaps in regulation, gaps in regulation, mixture of policy, regulation and operations; and ineffective regulation.”
“Although the agencies generally work well together, their roles, sometimes, overlap and there are significant information gaps within the government as, sometimes, one institution is unaware of what the other is doing.
“At the same time, policy making capacity has been weak, resulting in NNPC and its subsidiaries setting policy and regulation as well as conducting operations in the petroleum sector. The result is an ineffective and inefficient institutional environment in the petroleum sector in Nigeria.”
The new body is also expected to work under the policy supervision of the Minister of Petroleum Resources in order to reduce the inefficiencies in parastatal in the petroleum sector.
READ ALSO: Nigeria to get $5bn from international oil companies
The minister of petroleum resources will set and monitor implementation of policies.
“This does not mean that the regulatory authority will report to the Ministry on a day to day basis. The new single regulatory authority will be an operationally independent regulatory institution. The Minister’s involvement will be hands off and just to ensure that the regulatory authority properly carries out its roles of implementing the policy.”