Southern states kick against Nigeria oil sector Bill

Nigerian President Umaru Yar’Adua, his country hit by an unprecedented fall in crude production after three years of militant attacks, is facing mounting pressure to divert more government revenues towards oil-producing states in the impoverished south.

The governors of Delta, Edo, Bayelsa, Rivers, Cross River and Akwa Ibom states recently threatened to withdraw from an amnesty scheme, offered by Yar’Adua last month to the region’s militants, if a proposed new law designed to reform the oil sector is not amended.

The support of legislators and community leaders in the volatile Niger Delta, where international oil giants operate is crucial to the realisation of the amnesty scheme.

A bloc of southern lawmakers has asked Yar’Adua to dismiss Oil Minister Rilwanu Lukman, alleging that he favours states in his own northern region.

The north of Nigeria, a country of 140-million people, is dominated by Muslims while the south is mainly Christian.

The reform Bill, also called the PIB, has revived long-standing tensions between the south—rich in oil but whose population is mired in poverty—and the north.

Eighteen senators from six oil-producing states on Wednesday rejected the proposed new oil law which seeks to reform the corruption-ridden oil and gas sector.

One of the senators, Victor Ndoma-Egba, told reporters the law “neither addresses the fundamental issues of the degraded environment of the region nor the participation of its people in their God-given endowments”.

The region produces 90% of the nation’s foreign exchange earnings.

“We propose that the Bill be withdrawn and completetely redrafted to ensure respect for the component parts of the federation, fair play and equity,” Rivers state’s enviroment commissioner Ezemonye Ezekiel-Amadi told a public hearing on the Bill.

Oil companies recognise the tensions caused by the Bill.

“The atmosphere is hot between them,” a representative of a foreign oil company told Agence France-Presse.

“We are happy to explain our stand from a technical and professional point of view on the reform.”

Yar’Adua, former governor of northern Katsina state, unveiled proposals in late June for an unconditional amnesty for all militants who have attacked the oil sector.

The activities of the armed militant groups, especially the Movement for the Emancipation of the Niger Delta (Mend), have gravely affected oil production, compromising a presidential hope to make the country one of the world’s 20 largest economies in 2020.

In 2006, before Mend came on the scene, Nigeria produced 2,6-million barrels a day. But its “total oil war”, characterised by sabotage of oil installations and kidnapping of oil workers, has brought production to its knees.

Nigeria’s oil revenue was slashed by half to $4,92-billion in the first quarter of 2009 compared to the previous quarter, the national bureau of statistics said last week.

Current estimations put the oil production figure at between 1,2-million and 1,4-million barrels a day.—AFP

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