Senate receives interim report on petroleum downstream sector

Senate receives interim report on petroleum downstream sector

*C’ttee urges Senate to approve N348bn for inherited local debts owed oil marketers

The Senate on Wednesday mandated its Committee on Petroleum Resources (Upstream) to investigate issues relating to ongoing lease renewals in the oil and gas sector of the economy.

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It is believed that process is being undertaken by the Minister of State for Petroleum Resources, Dr Ibe Kachikwu and the Department of Petroleum Resources (DPR).

The resolution followed consideration of a motion by Sen. Omotayo Alasoadura (APC Ondo) and three other senators.

The motion was entitled “Irregularities in Ongoing Oil and Gas Lease Renewal and Massive Loss of Government Revenue”.
Leading debate on the motion, Alasoadura said that the Committee on Petroleum Resources had since December, 2017 been inundated with petitions and complaints over alleged multiplicity of irregularities surrounding the renewal of oil and gas leases.
He said there were also allegations that Kachikwu was granting illegal discounts and rebates in the exercise.
Alasoadura added that “the action of the Minister of State is capable of short-changing the country and denying the Federation the appropriate revenue accruable from the renewal of the leases.

“The Minister and the Department of Petroleum Resources were proceeding to renew leases of companies that had brazenly and illegally refused to pay royalties from oil and gas lifted by the companies in contravention of extant laws.

“Under the provision of extant laws, failure to pay royalties is a ground for revocation of leases and a legal barrier to renewal of applicable leases.

“There is a subsisting legal framework and due process mandated by extant law for the renewal of leases that are due,” he said.

Under presentation and consideration of reports, the committee on downstream petroleum sector recommend that the Senate do approve the sum of 348 billion Naira for the payment of inherited local debt owed petroleum marketers.

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