Nigeria’s Federal Government may heed the advice of a special committee it set up, which recommended the establishment of Special Courts to prosecute the rampant cases of oil theft and bunkering in the Niger Delta region.
The Committee, headed by the Deputy Governor of Bayelsa state, Rear Admiral Gboribiogha John Jonah, made the recommendation to the National Economic Council (NEC) meeting, which held on Thursday at the Aso Presidential Villa, Abuja, presided over Vice President Yemi Osinbajo.
The Committee said: “Federal Government should set up special courts for speedy prosecution of oil bunkerers and oil theft suspects.”
it also recommended engagement of traditional rulers to sensitize their communities on the criminal and environmental dangers of oil theft.
The Committee recommended that procurement and deployment of appropriate technology in surveillance and combat vehicles/boats in difficult terrain be effected to drastically reduce incidents of oil thefts and illegal bunkering “and this would ensure full benefits of uninterrupted supply.”
Other highlights of the NEC meeting which lasted for several hours and attended by governors of the 36 states, relevant ministers, Central Bank Governor and others are:
- REPORT ON EXCESS CRUDE PROCEEDS
- Honourable Minister of Finance (HMF) reported to the Council that the balance in the ECA stood at (USD 2,259,688,878.06 billion) as at 30th April, 2016. She disclosed that interest accrued on the account is USD 429,903.55 for the month of April 2016 experiencing a little drop in interest.
- UPDATE ON THE RECONSTITUTION OF THE BOARD OF NIGER DELTA POWER HOLDING COMPANY (NDPHC)
The Chairman of Council, the Vice President informed that His Excellency, the President has approved the reconstitution of the board, which will be effected in due course.
UPDATE BY NEC AD-HOC COMMITTEE ON MANAGEMENT OF THE EXCESS CRUDE ACCOUNT (ECA) AND PAYMENT INTO THE FEDERATION ACCOUNT
Edo State Governor reported to the Council that their sub-committee endorsed the forensic auditors firms as earlier proposed by the Finance Minister to audit the ECA.
UPDATE BY NEC AD-HOC COMMITTEE ON CRUDE OIL THEFT PREVENTION AND CONTROL
Bayelsa Deputy Governor reported to the Council that, the Committee set-up sometimes in 2013 consulted widely with relevant stakeholders including the Armed Forces Joint Task Force (JTF), Oil Companies, Oil Producing States, Nigerian Security and Civil Defence Corps (NSCDC) among others.
- Key findings of the Committee as to the causes of crude oil theft include:
- Inadequate operational patrol vessels to conduct patrol of entire pipeline network;
- Massive unemployment among youths in the region attributed to increasing incidence of theft and vandalism;
- Non availability of petroleum products in the Niger Delta Area also responsible for reoccurrence illegal bunkering.
Among the key recommendations of the Committee are:
- Procurement and deployment of appropriate technology in surveillance and combat vehicles/boats in difficult terrain would drastically reduce incidents of oil thefts and illegal bunkering and this would ensure full benefits of uninterrupted supply.
- Federal Government should set up special courts for speedy prosecution of oil bunkerers and oil theft suspects.
- Engagement of traditional rulers to sensitize their communities on the criminal and environmental dangers of oil theft.
Among others are:
- Increase the refining capacity of the domestic refineries through relocation/co-locating smaller cost-efficient refineries within time frame of 12 – 24 months.
- Focus on restoring upstream production by positively engaging host communities to put the current militancy to an end.
- Focus on improving Government funding in the upstream sector where funding has been less than 30%.
- Relieve Government of monthly cash-call funding and create a sustainable self-funding arrangement.
- Continue to engage the general public and all stakeholders by providing relevant information and education.
UPDATE ON STATES THAT HAVE RECEIVED BAILOUTS FUNDS AND THOSE OUTSTANDING
CBN Governor reported that:
- 30 States have so far benefited with the salary bailout as at 18thMay, 2016
- 35 States have applied for the Excess Crude Account-backed loans
- UPDATE ON FUEL SUPPLY AND MARKETING
The Minister of State for Petroleum briefed the Council, and stated that:
- Fuel scarcity was due to non availability of FOREX as a result of significant decline in government foreign earnings due to 60% drop in global crude oil price compared to 2014.
- NNPC supply dynamics had crumbled and NNPC is now straining to supply over 90% of the national demand for PMS from the 48% it was designed to supply.
- Prevalent hoarding, smuggling and diversion of the product have reduced volumes available for citizens/end users.
- Scarcity has created abnormal increase in prices resulting in our people paying an average of N150 – N300 per litre.
- There is no provision for subsidy in 2016 Appropriation as current estimated subsidy claim per month is N16.4 billion
- Consequences of imminent difficult situation if not addressed would be:
- Inability of government at all levels to pay salaries or meet financial obligations
- Increased scarcity of product leading to long queues
- Continuous upward surge of prices across the nation.
PRESENTATION ON STRATEGIC PLAN FOR 2016 BUDGET IMPLEMENTATION
Minister for Budget and National Planning made a presentation to the Council on Strategic Implementation Plan for the 2016 Budget of Change.
- Key highlights of the presentation are:
- Implementation of 34 priority actions across 4 fundamental areas to progressively facilitate true national transformation.
- The 4 fundamental areas constitute the focal points for prioritized execution and implementation of the Government’s short -term strategy as follows:
- Investing in critical infrastructure
- Embracing and encouraging private sector
- Continuously advocating for greater social inclusion
- Improving security and tackling corruption.
- Among the strategies for achieving the goals across 6 thematic areas of the 2016 budget are as follows:
- Changes in the policy environment, National Security and Governance
- Diversifying the economy by fast-tracking Industrialisation, Agriculture and Agro-Allied Processing, as well as attracting investment into solid minerals, Tourism and Entertainment sectors.
- Priority critical infrastructure, focused on increasing investment in power, rail, roads and housing.
- Oil and Gas Reform
- Ease of doing business
- Social investment
- Robust Monitoring and Evaluation (M&E Framework)
- The Strategic implementation plan would be incomplete without a focus on systematically tracking the achievement of actual outputs and outcomes.
- Ministry of Budget and National Planning will, going forward, utilize the revised National Monitoring &Evaluation framework to institutionalise the process of carrying out physical inspections and other verification exercises
- Impact Assessment of policies, projects and programmes on regular basis at the national level
- The M&E reports will be an input into the process for capital allocation releases to MDAs.
- NBS tracking of statistical indices are critical in measuring performance and rewarding delivery.
- PRESENTATION OF POLICY DRAFT ON FISCAL SUSTAINABILITY PLAN
In response to previous requests, the Honourable Minister of Finance made a presentation to the Council on Fiscal Sustainability Plan and Fiscal Framework for Sub-National Governments in Nigeria. This included:
- Five (5) key strategic objectives and recommended action points with a view to achieving objectives around improved fiscal behaviour that will align both short-term and long-term sustainability objectives of the Federal and State Governments
- The 5 key elements are:
- Accountability and Transparency;
- Increase in Public Revenue;
- Rationalisation of Public Expenditure;
- Public Financial Management Reforms; and
- Sustainable Debt Management.
Council then approved the Fiscal Sustainability Plan.
PRESENTATION ON POLICY PAPER ON SOLID MINERALS EXPLORATION BY BOTH FEDERAL AND STATE GOVERNMENTS
Minister of State for Solid Minerals presented a policy paper to the Council. The highlights of the paper among others are:
- Nigeria was once a mining nation and ranked as a leading producer and exporter of columbite, sixth producer/exporter of the metal and producer of coal amongst others.
- Nigeria lost those positions due to greater attention to oil exploration and exploitation, and also the indigenisation Decree of the 70s that led to the departure of the multinationals that owned the then Tin and Columbite mines.
- The policy paper was presented to NEC to apprise the reforms of the minerals sector and to particularly address issuance of licences for solid minerals exploration by both Federal and State Governments. [myad]