Diezani Alison-Madueke ready to tackle Nigeria's oil industry reforms

Nigeria's Oil Minister Diezani Alison-Madueke will take her seat as the first female oil minister in OPEC when the group meets in Vienna on 14th October. It is expected that Alison-Madueke will bring to light President Goodluck Jonathan's struggle with international oil companies and insurgent groups whose continued attacks have slowed investment in to the country for the past five years.

Among many of her challenges, one will be to see through the parliament a Petroleum Industry Bill (PIB), already disparaged by international oil companies for giving too much revenue and control to the state. Another is to manage a government plan to hand over 10 per cent of petroleum income to communities in Niger Delta to appease militant groups. Alison-Madueke is also expected to argue Nigeria's case for a larger oil quota, the source of 80 per cent of government revenue.

Talking about her new role she said that it “comes with a great onus of responsibility,” which rests on her shoulders alone. She also said that although OPEC “has done very well over the last 50 years,” the energy sector is changing, particularly its effect on the environment and that it is therefore important to take note of the changes.

As regards Nigeria's OPEC quota, Alison-Madueke said it was set during a particularly turbulent time of militant attacks that had impacted on the country oil production, and added that the quota should be reviewed. Nigeria's official quota is 1.673 million b/d, although it pumped about 2 million b/d last month alone.

Another issue to tackle will be that of implementing the proposed oil and gas law without alienating international oil companies, some of whom have expressed concern that the law would increase taxes making it unprofitable to invest in Nigeria's deepwater fields. As well as that, Nigeria's plan to give a 10 per cent oil and gas stake to Niger Delta communities, in order to reduce hostility toward oil companies, may prove more difficult than initially expected. A spokesman for Movement for the Emancipation of the Niger Delta (MEND) Jomo Gbomo has said that Alison-Madueke is too “elitist” to empathise with the militant cause and that she has no clue as to what the “struggle is all about.”

However, Alison-Madueke is determined to see the plan through and vowed to work closely with the Niger Delta communities to do so. She also said that Nigeria is going to engage international oil companies in “constant discussion” until they “feel part of the bill,” although Nigeria's national interest remains her primary focus.

Source: Bloomberg

For more news and expert analysis about Nigeria, please see Nigeria Focus and Nigeria Politics & Security.

Nigeria: Further personnel changes rumoured

As analysed in recent editions of Nigeria Politics & Security, Petroleum Minister Mrs Deziani Allison-Madueke escaped dismissal in the minor reshuffle on 11th August, despite rumours of her imminent removal. Deputy Finance Minister Remi Babalola was not so lucky, being summarily reassigned to a ministerial backwater following his “unguarded” public comments about the purported insolvency of the Nigerian National Petroleum Corporation (NNPC).

However, this may not be the end of the current struggle for influence in Nigeria's oil hierarchy. Our sources have suggested that the next person in the line of fire may be NNPC Group Managing Director (GMD) Austin Oniwon, upon whose letter to the Federation Account Allocation Committee (FAAC) Babalola's fatal comments were apparently based.

Whether this speculation has any mileage remains moot. However, Menas Associates has noted with interest the increasing behind-the-scenes frustration of the presidency with the slow progress in narrowing the gap between the NNPC's view of the Petroleum Investment Bill (PIB) and the views of the oil industry. Oniwon has been a key figure in the NNPC's uncompromising stance, and has resisted calls from Allison-Madueke to move towards the middle-ground.

While Oniwon's departure might serve the presidency's interests vis-à-vis the PIB, it would further reinforce criticisms of Jonathan's (and Allison-Madueke's) handling of the NNPC: Oniwon took over from Shehu Ladan only four months ago, while Ladan himself had barely spent seven weeks in the position before he was replaced. Sources suggest that Oniwon – an indigene of Kogi State – will be replaced by a GMD from the South-East.

For more news and expert analysis about Nigeria, please see Nigeria Focus and Nigeria Politics & Security.

© 2010 Menas Associates

Nigeria oil reform bill to be passed by the end of August says oil minister

According to Nigeria's oil minister Deziani Allison-Madueke, the Nigerian government is set to pass legislation to reform the mainstay oil and gas industry by the end of August, and will delay a recess in order to do so if necessary.

"The Petroleum Industry Bill (PIB) will be passed by the end of August ... Over the next 12 months there will be a lot of aggressive reform implementation of the PIB," said Allison-Madueke in an interview.

There has been some controversy over the PBI expected to overhaul Nigeria's oil and gas industry, and to narrow differences among all parties involved. It is thought that a special committee will be set up to look into and synchronise the interests of all involved before the bill is passed into law.

Allison-Madueke also said that outstanding licence renewals for foreign oil producers, some of which lapsed more than year ago, would be resolved within the next two to three months.

Source: Reuters

For more news and expert analysis about Nigeria, please see Nigeria Focus and Nigeria Politics & Security.