DETAIL, Nigeria’s leading commercial solicitors’ firm, has published a new report outlining the latest updates in the Nigerian Petroleum Industry Act (PIA).
The report titled “Oil and Gas Guide 2021” provides a clear understanding of the structures in the PIA, and the new business models in the entire value chain of the Nigerian oil and gas industry.
The report, delivered to The Energy Republic, outlines the new reforms in the petroleum ownership & licensing frameworks, environmental laws, and the roles of government institutions under the Petroleum Industry Act in ensuring the transparency and accountability of the oil and gas industry to attract more investment opportunities.
Based on our findings, the report pointed out some key enablers in the licensing framework, such as the award process of granting licenses or leases to companies operating in the upstream sector and delineating the broad categories of licenses and permits that will be issued.
The report stated that all existing Oil Prospecting Licenses (“OPLs”) and Oil Mining Leases (“OMLs”) will automatically be converted to Petroleum Prospecting Licences (“PPLs”) and Petroleum Mining Leases (“PMLs”) respectively upon their expiration.
The effect of conversion is that the holders of the PPLs or PMLs will be subject to the fiscal regime and incentives under the PIA from the conversion effective date.
According to DETAIL, “The report aims to provide an overview of the pertinent changes and introductions made by the PIA concerning the oil and gas business in Nigeria.”
“In Chapter 1 of this report, the petroleum ownership structure in Nigeria and the governance institutions in the oil and gas industry are considered.”
“In Chapter 2, we examined the licensing framework under the PIA while in Chapter 3, we took a dive into the investment frameworks available to investors wishing to operate in the Nigerian oil and gas industry.
“On the other hand, the divestment options open to investors exiting the oil and gas business in Nigeria are treated in Chapter 4 of the
report.”
“The PIA introduces some reforms in the regulatory framework for the gas sector of the petroleum industry which is x-rayed in Chapter 5 of the report. Furthermore, the PIA makes elaborate provisions for the development of oil and gas host communities which are examined in Chapter 6.
“In Chapter 7 of the report, the new fiscal regime introduced by the PIA is examined.”
“Finally, in Chapters 8 and 9 of the report, we provided insight on the principal petroleum and environmental laws and regulations now regulating activities in the oil and gas industry.”