PIB Back on IOC Hot Seat

Nigeria’s Petroleum Industry Bill (PIB), which has been making the rounds for years in various forms, will halt new investment if it is passed, an ExxonMobil executive told a forum on the bill in Lagos. Mark Ward, head of the US supermajor in Nigeria said that the if the PIB is passed into law in its current form, it would stop new investments from foreign firms due to its onerous fiscal terms.

Nigeria’s minister of oil, Diezani Alison-Madueke said the bill was fair to the government, oil firms, and Nigerians, however the major E&P firms operating there do not agree.

"Quite frankly, the extremely large investments that are needed are seriously at risk under the proposed PIB [Petroleum Industry Bill] terms," Ward told the forum. If the bill passes without significant changes, "the government's aspirations to grow the business and the industry will not be met," he said.

Ward went on to say that the PIB could push the government’s take of oil revenues to above 90%, leaving operators with not much left for their effort. "Nigeria is already one of the most onerous fiscal regimes and now the government wants to make it tougher?...That is something we don't understand," Ward said.

Any hopes of expanding lucrative offshore production would be quashed if the bill passes unchanged, Ward said. "For deepwater: we're done. There are no investments that can be supported under the current terms of the PIB," Ward said.