Buhari signs PIB into law

Nigerian President Muhammadu Buhari has signed the Petroleum Industry Bill (PIB), a piece of legislation that establishes a new legal regime for the country’s oil and gas industry, into law.

According to Femi Adesina, a spokesman for Buhari, the president took this step on August 16, a month after the PIB was passed by both houses of Nigeria’s National Assembly. He signed the bill at his home, while observing a five-day quarantine following his return from a visit to London on August 13, Adesina said.

“[The] president assented to the bill [on] Monday, August 16, in his determination to fulfill his constitutional duty,” the spokesman said. “The ceremonial part of the new legislation will be done on Wednesday [August 18], after the days of mandatory isolation would have been fulfilled.”

Nigeria’s government has been working for more than a decade to secure the adoption of a new law governing the oil and gas sector. This was partly because the existing legal regime was thought to be outdated and incapable of handling all the challenges posed by changes in the industry and partly because it did not adequately address the concerns that international oil companies (IOCs) had voiced about corruption, contracts and other issues. However, all previous attempts to pass a new law failed.

The most recent of these attempts began in August 2020, when Buhari’s administration submitted its draft version of the PIB to the National Assembly. At the time, the president said he expected MPs to approve the measure by the end of the year. Members of the Senate and House of Representatives duly passed the legislation in the first draft in late September and in the second draft in late October. But they subsequently postponed the third reading in order to concentrate on other key tasks, including the passage of a new budget for 2021. After resuming debate on the PIB in the spring of 2021, they finally approved the bill in the third reading in July.

Now that the president has signed the PIB, Abuja can start the process of implementation. This is likely to generate some controversy, given that the final version of the bill reserves only a 3% share of oil revenues for the communities that host oil and gas development operations. Representatives of many host communities in southern Nigeria, where most of the country’s onshore fields are located, have complained that this share is too small and have lobbied for 5% or 10%.