President Muhammadu Buhari, in a letter dated 16th September 2021, transmitted proposed amendments to the Petroleum Industry Act (PIA) 2021, to the National Assembly for legislative action. This is coming barely one month after the Petroleum Industry bill received presidential assent. The amendments are with regard to the administrative structures of the Upstream Regulatory Commission (URC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), both institutions established by the PIA. Particularly, the amendments seek to increase the number of non-executive commissioners on the governing board of the URC from two to six, in order to achieve representation of the six geo-political zones in Nigeria. It also seeks to increase the number of non-executive directors in the NMDPRA from two to six (for representation) and reduce the number of executive directors of the Authority from seven to five.
The amendments proposed by the President are as follows:
Section 11(2)(b) “two non-executive commissioners” to be replaced with new Section 11(2)(b) as “six (6) non-executive members, one each from the geopolitical zones.”
Section 34(2)(b) “two non-executive directors” to be replaced with new Section 34(2)(b) as “six (6) non-executive members, one each from the six geopolitical zones.”
The amendment seeks to reduce the number of executive directors for the Authority in section 41(2), from seven to five, and reads as follows:
“there shall be five (5) executive directors for the Authority whose appointment shall comply with the rules of the Federal Civil Service with each responsible for one of the following”
The amendment further proposed the deletion of paragraphs (f) and (g) in section 11(2) and the deletion of paragraphs (f) and (g) in section 34(2) to remove representatives of the Ministries of Petroleum and Finance from the composition of the governing boards of the Commission and the Authority.
Furthermore, the provision of section 11(3) which subjects certain appointments by the President to the Board of the Commission, to Senate confirmation was rephrased in the amendment to read as follows:
“Appointments to the Board of the Commission under subsection (2) of this section shall be made by the President. Appointments made pursuant to subsection (2)(a), (b) and (c) of this section shall be subject to confirmation by the Senate.”
Similarly, the provision of section 34(3) of the PIA which subjects certain appointments by the President to the Board of the NMDPRA, to Senate confirmation was rephrased to read as follows:
“Appointments to the Board of the Authority under this section shall be made by the President. Appointments made pursuant to subsection (2)(a), (b) and (c) of this section shall be subject to confirmation by the Senate.”
This is with an aim to give effect to the amendment that seeks to remove representatives of the Ministries of Petroleum and Finance from the governing boards of both the Upstream Commission, and the Midstream and Downstream Authority.
According to President Buhari, the objective of the proposed amendments is to lay sound administrative structures for the two institutions and ensure their smooth take-off and growth.