Reps probe over N895bn gas supply payment approved by FEC


October 19, 2017 | 6:43 pm
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Members of the House of Representatives on Thursday unanimously resolved to set up an Ad-hoc Committee to investigate the N895 billion approved by Federal Executive Council (FEC) for gas supply.

The resolution was passed sequel to the adoption of the motion sponsored by Chris Emeka Azubogu (PDP-Anambra).

Similarly, the lawmakers agreed to set up another Ad-hoc Committee that will investigate over $14 billion allegedly lost as a result of non-payment of gas flared penalties by International Oil Companies (IOCs) From April 2008 and 2016, as proposed by Johnson Agbonayima (PDP-Edo).

In his lead debate, Azubogu explained that FEC approval N701 billion for Nigeria Bulk Electricity Trading as an intervention in the power sector as well as other payments to Distribution Companies (DISCOS).

He said that the Federal Government and the World Bank Group were planning $2.519 billion as financial support for Nigeria Bulk Electricity Trading (NBET).

Azubogu added that the support was a payment guaranty for the Power Generating and Gas Supplier Companies to ensure stable power supply that will drive the economy.

He explained that the National Council on Privatization (NCP) and the Bureau of Public Enterprises (BPE) were statutorily empowered to manage the Privatization and Commercialization Programme by ensuring that the Power Sector Reform progresses successfully.

The lawmaker emphasised that the NCP had been properly constituted with the Vice President of Nigeria as the Chairman and the Minister of Finance as the Vice Chairman with representatives of the Ministries of Finance.

Other representatives, he said include ministries of Trade and Industry, National Planning, Justice and the Central Bank of Nigeria (CBN).

He said that although the ministers of Power and Petroleum resources were not members of the NCP, they ought to be invited to meetings that will involve energy steering committee established by the NCP.

Azubogu added that the Chief of Staff (COS) to the President should be invited to meetings as the representative of the Office of the President.

The House therefore, mandated its committee on Power to investigate the approval to ensure that the entire process was geared towards significant improvement of power supply in Nigeria and submit its report within four weeks for further legislative action.

In a related development, the House urged relevant Government Agencies to undertake a damage and post impact assessment of gas flared environment and direct payment of compensation by oil companies to affected communities.

In his leade debate on the motion, Agbonayinma explained that gas flaring was harmful to the economy and the environment as the gas flared contained toxic substances which caused respiratory diseases and air pollution.

He added that this could lead to depletion of the Ozone layer, and ultimately, having adverse effects on the weather and climate.

“The House also notes that statistics show that the quantity of gas flared in Nigeria exceeds over 40 percent of gas flared across Africa, which amounts to trillions of Naira that have been wasted over the years.

“The House further notes that the consequences of gas flaring include destruction of farmlands, damaging of crops, contamination of the air and acid rains which, apart from corroding corrugated aluminum roofs, acidify the soil in the areas where gas flaring takes place.

“The House is aware that the Federal Government, in a bid to discourage gas flaring and encourage the redirection of gas flared from waste to wealth, and also to save the environment and the lives of the people living in the gas flared environment, imposed a penalty of $3.5 per 1000 SCF of gas flared by Oil Companies.

“The House is also aware that the Deputy Director and Head, Upstream of the Department of Petroleum Resources (DPR), while speaking at a Conference in Houston, Texas, USA recently, said that the country has lost 14,298 billion dollars between April 2008 and October 2016 in form of penalties for gas flaring which the International Oil Companies (IOCs) failed to pay.

“In a similar vein, the Nigeria Extractive Industries Transparency Initiative (NEITI), in its latest Oil and Gas Audit Report, noted that Firms operating in the country have failed to abide by the regulating penalty of 3.5 dollars for every 1000 SCF of gas flared by oil companies.”

Agbonayinma expressed concern that Multi National Oil Companies which adhered strictly to internationally acceptable environmental best practices in their countries and other parts of the globe had refused to pay the agreed penalties on gas flared in Nigeria.

The House therefore, resolved to set up an Ad-hoc Committee to investigate the non-payment of penalties on gas flaring by oil companies and report back to it within eight weeks for further legislative action.




October 19, 2017 | 6:43 pm
  |     |     |   Start Conversation

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