Following the signing of the Petroleum Industry Bill into law by President Muhammadu Buhari on Monday, August 16, the Federal Government has begun its implementation on Tuesday.
Minister of State for Petroleum Resources, Chief Timipre Sylva while speaking at a press conference Tuesday said Nigerian National Petroleum Corporation (NNPC) will become a commercial company by the first quarter of next year.
Sylva said a transitional committee has been set up to incorporate NNPC Limited, noting that the corporation’s shares will be vested in the government with the Ministry Of Finance in charge.
The Minister noted that subsidy policies will still be in place till further notice, even though the new petroleum act has deregulated the oil sector.
According to the PIB Law, six months from commencement of the new law with ownership vested in the Ministry of Finance, the Federation will take over assets, interests and liabilities of NNPC. This structure will pave the way for the eventual sale of shares to Nigerians.
Any assets, interest and liabilities not transferred to NNPC Limited after the takeover by the Ministry of Finance will remain with NNPC until extinguished or transferred to the government, after which NNPC shall cease to exist. Transfer and sale of the shares are subject to approval by the government and endorsement by the National Economic Council.
NNPC Limited will earn 10% of proceeds from the sale of oil and profit gas as management fee while 30% will be remitted to Frontier Exploration Fund for the development of frontier acreages in addition to 10% of rents on petroleum prospecting licences and mining leases.
