The Civil Society Legislative Advocacy Centre, CISLAC, has advocated the clear separation between commercial and regulatory activities, to ensure efficiency in the petroleum industry.    The Senior Manager, CISLAC, Mr. Kolawole Banwo, stated this at an oil and gas sector forum held in Lagos.

According to him, some of the challenges bedevilling the petroleum industry are simply due to conflict of interest arising from commercial, as well as regulatory issues. “By default, if companies like; Shell, Mobil and other Majors do wrong, they will definitely not get away with it. However, Nigeria National Petroleum Corporation, NNPC, could get away with some of these crimes if sanctioned because of its systematic complexity.

“There is conflict of interest in all of this and that is why it is imperative for sanctions to be effective, the regulator and operators should be separated for adequate checks and balances in the sector. The clear scenario between NCC and MTN is a good one,” he said. He also stated that the lack of political will has given birth to rise in nefarious activities among operators in the industry.

“Corruption is also something we cannot hide from. This is because some of the operators, private sector holders, have interest in politics (They support campaigns of politicians and other beneficial parties). How then can you bit the hand that has fed you?

He also advocated for transparency in the industry. “The industry has to be more open so that there will be transparency, reduction in conflict of interest and we can have sanctions that will be applied to all. We are aware that some of the sanctions are weak going by the law, but some also are not weak, only that they have been crippled by conflict of interest.

As regards Ibe Kachikwu’s dual responsibility as the GMD, NNPC and Minister, state for Petroleum Resources, he said that development of the petroleum industry will be jeopardised.

In his view, “It is an institutional thing. Separate regulation from the operation. For instance, we have DPR, and NNPC, while DPR is a regulator and NNPC operator. If NNPC can be strictly for business, it doesn’t really matter who is the Minister. Because when the law states thus, one cannot do otherwise.

But because they have combined both roles there will be prevailing conflict of interest. As the industry is, there is no separation of these functions and that is why the problem will be unending.”

Source: Vanguard