Organised private sector (OPS) has said it was averse to a single regulator for the oil sector, as championed in the new Petroleum Industry Governance Bill (PIGB).
It said the idea of a single regulator was contrary to industry standards, which, by default, already provide for an upstream and downstream regulator, noting that the responsibilities to be handled by the proposed commission was too wide.
Addressing a joint media briefing by all members of the OPS on the PIGB, the director-general of the Manufacturers Association of Nigeria (MAN), Mr Segun Ajayi-Kadiri, said some parts of the PIGB should be corrected before being passed into law.
Ajayi-Kadiri, who is the head of the OPS, comprising NECA, NACCIMA, NASSI and NASME, said the establishment of a single regulator to be called Petroleum Regulatory Commission (PRC), would create a behemoth in a sector that was not homogeneous in its activities and deliverables and it would do more harm than good to the petroleum sector.
He said: “The bureaucratic bottlenecks that would arise would clearly negate the ease of doing business policy vision being pursued by the present administration, as an omnibus regulator will further result in cumbersome and constant delays in securing the necessary approvals to conduct business.
“An all-powerful single regulator will not be able to technically examine and appreciate the regulatory, commercial and other operating environment issues from the deserved different dimensions and from the different viewpoints of the stakeholders.”
Continuing, he stressed that a single regulator was effectively a regulatory monopoly, which in the long run would promote inefficiency.
He said particular concern about a monopoly regulator was that its functions would be more rigid and bureaucratic than specialised agencies regulating the downstream and upstream separately.
“A single regulator will not spur competitiveness nor enhance the contributions of upstream and downstream sectors to the national economy,” he said.
The OPS, therefore, called for the creation of two regulatory bodies each focusing on the downstream and upstream sectors of the industry and on the entire gamut of technical and commercial issues in each of the sub-sectors.
“Being mindful of the need to merge and streamline the number of existing regulatory agencies in the face of dwindling revenue of government, we hereby affirm that there is no need creating another regulatory agency that will further swell the list of existing agencies with similar functions and duplicated mandates.
“Specifically, we canvass a simplified arrangement where the Petroleum Products Pricing Regulatory Agency, which has been saddled with the responsibility of commercial regulation since 2003 and has the relevant experience, structure and personnel, should be strengthened to continue to superintend the downstream sector, while the Department of Petroleum Resources oversees the upstream sector,” he said.