OIL AND GAS SECTOR REFORMS IN NIGERIA:
WHAT YOU SHOULD KNOW
Nigerian oil and Gas policy
THE NATIONAL OIL AND GAS POLICY
The National Oil and Gas Policy was approved by the Federal Executive Council under the chairmanship of President Umaru Musa Yar’adua on the 5th of September, 2007. The singular objective of the policy was to make far reaching changes and ensure the fundamental transformation of Nigeria’s Oil and Gas industry, to bring it in line with 21stcenturyglobal industry
THE GENESIS OF THE POLICY
In the opening months of the new century, it became obvious that the legal and governance structures that had been designed since the 1970s cannot adequately cater for the requirements of a contemporary Nigerian Oil and Gas industry. For example, though amended in many instances along the way, the Petroleum Act (1969) remains a forty year old document that was designed for the industry at its infancy. Similarly, the NNPC Act (1977) despite the various amendments is an outdated piece of legislation that is out of tune with contemporary global business realities. In addition, the laws are contained in several pieces of legislation. This is coupled with the fact that the numerous amendments, policy statements and regulations are dispersed in several documents and are often difficultto locate.
The above also applies to virtually all the institutions of the industry. The Ministry of Petroleum remains essentially a civil service outfit that is ill-equipped to conceive and formulate the required policies for such a complex and sophisticated industry. The regulatory body, the Department of Petroleum Resources (DPR) is, by and large, similarly constrained being a body tucked away within the Ministry. The most problematic, however, remains the National Oil Company, the Nigerian National Petroleum Corporation (NNPC). It is simply a typical State institution that operates as a huge amorphous cost centre with little or no sensitivity to the bottom-line.
The need for far reaching reforms of the country’s Oil and Gas industry is therefore evident. This is what prompted the last administration in the country to establish the Oil and Gas Sector Reform Implementation Committee (OGIC). The Committee was inaugurated on the 24th of April, 2000 under the Chairmanship of Dr. Rilwanu Lukman (CFR) then serving as the Presidential Adviser on Petroleum and Energy (The Chairmanship later passed on to Dr. Edmund Daukuru, former Minister of State for Energy).
The OGIC was charged with broad and wide ranging terms of reference to make recommendations for a far reaching restructuring of Nigeria’s Oil and Gas industry. The Committee comprising of a wide spectrum of individuals from both the public and private spheres of the industry, worked for four years to produce The National Oil and Gas Policy. The new policy covers in a comprehensive manner all the relevant aspects of the industry: Upstream, Downstream, Gas, Petrochemicals and many other industry related matters.
The thrust of the new policy, however, revolves around the need to ensure separation and clarity of roles between the different public agencies operating in the industry. Equally of significant concern is the need to infuse strict commercial orientation in all the relevant aspects of the industry. The overall objective is to reposition the nation’s Oil and Gas industry in view of contemporary challenges within the sector both globally and in the domestic sphere. This as widely accepted as the surest way of securing maximum and sustainable value to the nation.
IMPLEMENTING THE NATIONAL OIL AND GAS POLICY
The National Oil and Gas Policy essentially provided broad and general guidelines for the emergence of the new Oil and Gas industry. These broad provisions have to be transformed into a more practical and concrete legal and institutional framework in order to effectively transform the Oil and Gas industry as envisaged by the policy. It is in this regard that the Federal Government constituted the second version of the Oil and Gas Sector Reforms Implementation Committee (OGIC).
This Oil and Gas Sector Reforms Implementation Committee was inaugurated by the President of the Federal Republic of Nigeria, Alh. Umaru Musa Yar’adua, GCFR on Friday, 7th September, 2007.
The membership and terms of reference approved by Mr. President are as follows:
Dr. Rilwanu Lukman Chairman
Dr. Emmanuel Egbogah Member
The Permanent Secretary, Ministry of Energy Member
The Group Managing Director, NNPC Member
The Director, DPR Member
The Executive Secretary, PPPRA Member
The Director (Oil and Gas) BPE Member
PENGASSAN (Mustapha Wali) Member
NUPENG (Peter Akpatason) Member
Mohammed S. Barkindo Member
Prof. Yinka Omorogbe Member
Mal. M. M.lbrahim Member
Ms. Donu Korgbara Member
Engr. Sani Bello Member
Dr. Bunu Alibe
Dr. Bright E. Okogu
Amb Hassan Tukur
Chief M. Olurunfemi
Mr. Ben Osuno
Mr. C. C. Nwuba
Engr. Magaji Inuwa
Dr. Bello Aliyu Gusau
TERMS OF REFERENCE
I. Assume the full mandate for the implementation of the OGIC report, especially as enshrined in the Road Map approved by government.
II. Advise on the take off of the new bodies, institutions, organisations and agencies that would constitute the institutional framework for the restructured Oil industry
III. Identify and put in motion all required amendments and changes in all legislations governing the country’s Oil and Gas industry as a result of the implementation of the OGIC report.
Seek the approval of Mr. President on all major amendments to the report that may arise in the course of implementation
To engage, as much as possible, all industry stakeholders in the course of the implementation programme, as well as resource persons, facilitators and consuItants where necessary.
METHODOLOGY AND WORK PROGRAMME
Gas Master Plan
In order to discharge its mandate, the Committee defined the nature of its assignment as requiring the accomplishment of the following:
Ensure the emergence of a new enabling legislation in line with new National Oil and Gas Policy to govern the operations of the industry
Design a new and detailed regulatory framework to guide the operations of all actors in the i nd ustry.
Ensure the establishment and take off of new policy, regulatory, management, commercial and research institutions in the industry.
In the bid to accomplish the above, the Committee undertook the following steps, actions and measures:
I. An extensive review, analysis and discussions of the National Oil and Gas Policy that has been earlier on approved by the Federal Executive Council.
II. Review, analysis and examination of the Legal and Regulatory frameworks that hitherto govern the country’s Petroleum industry with a view to determining their appropriateness with the requirements of contemporary realities in the industry.
III. Received and considered numerous submissions from various public institutions within the industry including: the Ministry of Energy, the ~ Nigerian National Petroleum Corporation (NNPC) and its various Strategic Business Units, the Department of Petroleum Resources (DPR), the Petroleum Products Pricing and Regulatory Authority (PPPRA), the Petroleum Technology Development Fund (PTDF), the Petroleum Equalization Fund (PEF) and many others.
IV. Interacted and received submissions from other State agencies outside the industry, including: Ministry of Justice, Ministry of Finance, Ministry of National Planning, Federal Inland Revenue Services (FIRS) and other government stakeholders.
V. Interacted, received and considered submissions from key stakeholders in the industry, including: Oil Producing Trade Sector of the Lagos Chamber of Commerce (OPTS), key downstream operators including Major Oil Marketers Association of Nigeria (MOMAN), Independent Petroleum Marketers Association of Nigeria (lPMAN), Depots and Petroleum Products Marketers Association (DAPPMA), Nigerian Gas Association, Petroleum Technology Association of Nigeria (PETAN), National Association of Indigenous Petroleum Explorationists (NAIPE) and many others.
VI. Undertook a series of retreats in Kaduna and Jos, alongside other stakeholders, to work on the enabling legislation contained in the Petroleum Industry Bill to be forwarded to the National Assembly.
VII. Considered reviewed and analyzed various industry models and practices from other petroleum producing jurisdictions within the context of global best practices.
THE ENABLING LEGISLATION FOR OIL AND GAS INDUSTRY
One of the key tasks of the Oil and Gas Sector Reforms Implementation Committee was to transform the broad provisions of the National O il and Gas Policy into a draft enabling legislation for the consideration of the National Assembly. In line with the underlying intent of the policy as mentioned above, the Committee set out, right from the onset, to come up with comprehensive all-encompassing draft legislation that covers all the relevant aspects of the country’s Oil and Gas industry.
The draft Petroleum Industry Bill that the Committee produced turned out to be much more than a simple exercise of transforming policy into law. It became necessary to take into consideration, in the drafting process, very many compelling issues in order to come up with a law that will comprehensively capture the legal and governance requirements of such a complex industry. The following in particular were pertinent:
I. The half century experience of operating the Oil and Gas Industry in Nigeria has to be adequately captured and reflected in all the major aspects of the sector, including policy making, regulation and commercial operations.
II. As corollary to the above, an elaborate interactive process had to be initiated in order to incorporate into the law the enduring concerns of all the key stakeholders in the industry, of course, within the context overriding interest. This consultative process had involved wide ranging stakeholders including OPTS members such as Shell, Exxon-Mobil, Chevron, Total, Addax and many others. Others are downstream players such as Major Marketers Association of Nigeria (MOMAN) such as OANDO, CONOIL, ZENON, TOTAL etc, the Independent Petroleum Marketers Association of Nigeria (lPMAN) and Depots and Marketers Association of Nigeria (DAPMAN).
III. The emergence of gas as a key element of the industry had never really been adequately captured by previous legislation regarding the industry. The proposed bill must of necessity make adequate provisions for all the above. This was done not only with regards to fiscalisation of gas resources in the upstream, but also the management and utilization of downstream gas facilities and products.
IV. The need to consolidate various pieces of legislation that were at various phases of processing in the National Assembly into the comprehensive draft Petroleum Industry Bill. Among these are the Downstream Gas Bill, the Petroleum Profit Tax Amendment Bill, the PEF and PTDF Bills.
THE DRAFT PETROLEUM INDUSTRY Bill
The draft Petroleum Industry Bill is a detailed document covering most of the relevant issues pertaining to Oil and Gas exploration, production, transportation and marketing in the country. Other issues covered include: matters of state participation and control, fiscal issues, regulation, safety, health and environmental concerns; and finally issues regarding community relations. The draft bill is divided into numerous parts including the following itemized below
Part one deals with fundamental Objectives of the legislation including vesting ownership of petroleum resources unto the sovereign State of Nigeria, allocation of acreages, Government participation, fiscal principles, and matters of transparency and good governance. Other matters covered in this part are environment and air quality emissions, community development and Nigerian content.
INSTITUTIONAL FRAMEWORK OF THE INDUSTRY
Part two of the draft provides for the institutional framework that governs the operations of the industry, including the functions, powers, structures and funding of these institutions. The institutions covered include: The Minister of Petroleum Resources, the National Petroleum Directorate, the Petroleum Inspectorate, the Petroleum Products Regulatory Authority, the National Petroleum Assets Management Agency, the National Petroleum Company of Nigeria, the Nigerian Petroleum Research Centre, the Petroleum Equalization Fund and the Petroleum Technology Development Fund.
UPSTREAM PETROLEUM SECTOR
Part three of the draft bill deals with issues pertaining to the operations in the upstream of the industry including: Licenses, leases and contracts. Others matters covered are Award Processes, Right of participation by the Government, Marginal fields, Indigenous companies, Termination and Revocation of Licenses and leases, matters on Fees, Rents and Royalties and finally provisions on Associated Natural Gas.
DOWNSTREAM PETROLEUM PRODUCTS
Part four of the draft legislation focused on the workings of the downstream sector especially on matters of licensing, refining and marketing of petroleum products. Others matters provided for in this part of the draft include the Transport Logistics Company, Facility Management Companies, Open Access and Non-discrimination, Pipelines and Depots and issues relating to Pricing of Products. Lastly, this part of the draft also provides for Operating stocks and National Strategic Stocks.
DOWNSTREAM NATURAL GAS
Part five of the draft bill is on various issues pertaining to downstream natural gas including both technical and commercial licensing regulations and conditions. Other sections of the bill in this part are the Network Code, Gas Supply Licenses, Transportation Pipelines Licenses and the Whole Sale Market. This part of the draft law also covers matters of Third Party Access, Customer Protection, the Pricing Regime, issues of Public Service Obligations and lastly Competition and Market Regulation.
Part six of the draft legislation is essentially an amendment to the existing Petroleum Profit Tax Act based on the need to create a new fiscal framework that takes into consideration various compelling issues. Included among these issues are matters such as the need to capture the full gas value chain for taxation purposes, developing a fiscal regime for gas that is decoupled from oil thereby creating a level playing field for all investors in gas and promoting the effective management of costs across the industry maximizing government take. Other considerations revolve around the requirement to develop a fiscal system that is responsive to the significant changes in prices; there is also the need to clarify inconsistencies and/or conflicts in the application of fiscal terms for oil and gas; and finally, to develop a fiscal rule of general application based on a body of fiscal laws rather than incentive letters.
HEALTH, SAFETY AND ENVIRONMENT
Part seven of the draft bill is on matters of Health, Safety and Environment. The matters covered under these issues include: Good Oil Fields Practices, Obligations of the Licensees, Lessees and Contractors. There are also matters of Abandonment, Decommissioning and Disposal and their funding.
Part eight of this draft is on matters of the obligations of various actors in the oil and gas productions processes towards the various communities in the oil producing region of the country. Included in this section are matters of community development, compensations, protection and management of the environment.
The New Nigeria's Oil and Gas Landscape - The Institutional Structure
REPEALS, TRANSITIONAL AND SAVING PROVISIONS
Part nine of the draft bill covers, among other things, all the various extant legislations that wou ld be repealed with the passage of this bill by the National Assembly. Also covered in th is part of the bill are various transitional issues licenses, leases and contracts. Other issues are on personnel of various existing institutions. Yet, other transitional issues covered include assets and liabilities of various institutions that would migrate to new ones.
INTERPRETATIONS AND CITATION
Part ten of the draft Petroleum Industry Bill is on the meanings and interpretations of the various terms, concepts, words, processes and institutions that featured in the draft bill. This part also includes the legal and official reference of the Act when it comes into usage.
Petroleum Product Pipelines
INSTITUTIONAL FRAMEWORK OF THE INDUSTRY
The other major task of the Oil and Gas Sector Reforms Implementation Committee is to prepare the new institutions proposed by the National Oil and Gas Policy, and subsequently enshrined into the draft Petroleum Industry Bill, for takeoff. The institutions involved are in various categories. First is the policy making institution: The National Petroleum Directorate (NPD), there are also regulatory institutions the Nigerian Petroleum Inspectorate (NPI) and the Petroleum Products Regulatory Authority (PPRA). The other institutions are commercial and operational bodies the Nigerian National Petroleum Company (NN PC Ltd) and the National Petroleum Assets Management Agency (NAPAMA). Lastly is the research institution, the National Petroleum Research Centre.
Below are brief details of the various institutions:
THE NATIONAL PETROLEUM DIRECTORATE
The strategic nature of petroleum to the Nigerian nation demands that policy formulation and implementation regarding the sector is not only accorded the highest priority but is conducted in an effective and professional manner. The above informs the need for a specific institution devoted continuously to the initiation, formulation, coordination and monitoring the implementation of policies for the Oil and Gas sector. This institution is the National Petroleum Directorate (NPD).
Prior to the new National Oil and Gas Policy, the regulatory framework that governs the Nigerian Oil and Gas industry has been very rudimentary and muddled up. Different institutions including the Ministry of Petroleum Resources (where the DPR has been housed for a long time), the National Oil Company (NNPC), the PPPRA (more recently), etc have been involved in one form of regulation or the other in the industry. Consequently, the whole process of regulation in the industry suffers from an abysmal absence of clarity of roles.
In the bid to design a new regulatory framework for the industry, the Committee adopted certain universally accepted benchmarks for regulatory institutions. Among these are the following:
I. Clearly defining the mandate and powers of the regulator.
II. Assuming powers to make and enforce regulations.
III. Limiting the role of Government, its agencies and officials to issuing only broad /general policy guidelines to the regulator as opposed to specific directives which amounts to day to day interference with the powers of the regulator.
VI. The tenure of the executive management is guaranteed and fixed and its abridgement made stringent upon cogent and verifiable reasons.
VII. The funding regime is structured to ensure its independence with budgetary appropriations subjected to legislative oversight and not attached to ministerial budgetary provisions with no provisions for grants from governments and/or stakeholders they will be regulating.
VIII. The enabling law spells out the administrative and enforcing instruments and also makes provisions for rule making, regulation formulation and enforcement.
IX. The staffing specifications, requirements and recruitments are specifically left in the hands of the regulator.
The above constitutes the framework for designing the two new regulatory agencies (Petroleum Inspectorate Commission NPI and Petroleum Products Regulatory Authority PPRA) recommended by the approved National Oil and Gas Policy. Below are the recommendations of the Committee on the two regulatory agencies:
THE NIGERIAN PETROLEUM INSPECTORATE (NPI)
In line with the recommendations of the National Oil and Gas Policy, the current Department of Petroleum Resources (DPR) would be restructured into an autonomous stand-alone regulatory agency to be renamed as Nigerian Petroleum Inspectorate. The Inspectorate would therefore subsume all the extant responsibilities of the DPR, including being responsible for setting regulations and standards for the industry and for ensuring adherence to environmental guidelines as from time to time to be enunciated by the Federal Ministry of Environment.
PETROLEUM PRODUCTS REGULATORY AUTHORITY (PPRA)
Despite the move towards more liberalisation in the downstream sector of the industry, the need for effective regulation of the petroleum products supply remains. The PPRA was proposed by the National O il and Gas Policy to expand and streamline the responsibilities currently being performed by Petroleum Products Pricing and Regulatory Agency (PPPRA).
The PPRA shall primarily be concerned with discharging the following responsibilities:
I. The coordination and regulation of all commercial activities relating to the downstream sector of the industry.
II. All the responsibilities in the downstream currently undertaken by the PPPRA
The regulation of transportation, transmission, distribution and marketing of downstream petroleum products.
Setting benchmarks for downstream gas, and for product prices ex refinery and at the pump in accordance with a price formula and the changes that have occurred in the intervening period in the reference international market prices and the reference marine transport index; In addition, the PPRA would focus on the following:
II. Setting regulations and administering the common carrier oil and gas pipeline regulatory regime;
III. Setting regulations and administering the open access depot regulatory regime;
IV. Regulating tariffs for the common carrier of oil and gas pipeline systems and open access depot system in accordance with tariff-setting formulae;
v. Setting regulations concerning holding petroleum stocks, including both Strategic and Operating stocks and ensuring refiners and Oil Marketing Companies compliance;
VI. The regulation and administration of open access regimes for transportation, storage and distribution;
VII. Tariff setting and administration;
VIII. Regulating refineries.
THE NIGERIAN NATIONAL PETROLEUM COMPANY LTD.
At the core of the new National Oil and Gas Policy is the establishment of a new Nigerian National Petroleum Company (NNPC Ltd) that is capable of competing both locally and internationally in all the relevant segments of the Oil and Gas industry. The underlying intent of the exercise in this regard, is to place the company in the same footing with other successful state owned oil companies.
ATTRIBUTES OF A SUCCESSFUL NOC
The Committee is of the view that for the new National Oil Company to effectively transform into the desired state, it must be endowed with certain key attributes:
I. A strict commercial orientation and focus.
II. Financial authority and accountability, with effective internal controls.
III. Independent and Professional Governance structures, with commercially driven decision making processes.
IV. Vertically integrated structures with well defined growth path
V. Highly talented and well motivated human resources
VI. Technology driven competitive edge and strong R&D capabilities
VII. Well defined key performance indicators and parameters
VIII. Simple, lean and flexible structure
IX. Differentiation between core functions and support services
X. Promotion of profit sub-structures and minimisation of cost substructures
THE NATURE OF THE COMPANY
The transformed NNPC will, therefore, have to be fully Commercialized, Capitalized and profit driven in line with best international practices. In the context of the vision of the OGIC, it will operate along the entire supply chain in an integrated fashion within and outside the shores of Nigeria.
It is therefore required that new structure and sub-structures of the NOC should be predominantly profit oriented, with very minimal cost sub -centers.
All structures/sub-structures should commercially justify their creation.
Accordingly the new NOC will, like most successful IOCs/NOCs have as its core activities the following areas:
a. Exploration & Production
d. Gas & Power
THE NATIONAL PETROLEUM ASSETS MANAGEMENT AGENCY (NAPAMA)
NAPAMA is conceived as an agency empowered to undertake cost/commercial regulation of the industry, with aim of ensuring that the nation derives the maximum value from its oil and gas resources. In particular, NAPAMA is to ensure that the nation’s oil and gas resources in its portfolio are exploited in a manner that maximizes its revenues at the lowest costs.
In particular NAPAMA would perform the following functions among others:
(1) To be the accountable entity for the costs of oil and gas exploration and production in Nigeria, ensure that all costs, depreciation, incentives, and other allowances/benefits accorded to operators in the oil and gas sector are fully justified and line with global best practices. By so doing, to ensure effective cost monitoring of Joint Venture, PSC operations and any other upstream oil and gas operations that attract Government Royalty and PPT through the following:
I. Manage the cost and other incentives profile of operators and deductions from Government PPT and ensure that such deductions are fully justified and supported by benchmarks from other countries with comparable environment.
II. Manage the portfolio (and review operator’s work Programmes) in terms of value for money and strategic fit with Vision 2020.
III. Promote value for money through the allocation of production quotas, investments and benchmarking.
IV. Challenge/encourage synergies among Operators.
V. Maintain transparency, accountability and integrity In dealings across joint ventures, PSCs and other oil and gas operations.
(2) Work in concert with NPI to provide information to FIRS In the assessment and collection of PPT and Royalty.
(3) To be a cost efficient and effective organisation entitled to a fixed charge per barrel equivalent of crude or gas handled.
INCORPORATED JOINT VENTURES
It is recommended that the existing NNPC Joint Ventures shall be incorporated into autonomous commercial entities. It is proposed to incorporate all assets currently held in the joint ventures into the new IJV companies. It must be mentioned that regardless of incorporation under CAMA, the IJV remained governed by the PPT Act.
The present Joint Operating Agreements UOAs) between NNPC and it JV Partners shall form the basis of the new Shareholder’s agreement. The concept of appointing one of the partners to be the operator of the Joint Venture in the current JOAs will be replaced by Joint Operatorship led by the majority shareholder. The concept of cash-call will be replaced by equity, debt and third party financing.
NATIONAL PETROLEUM RESEARCH CENTRE (NPRC)
The National Petroleum Research Centre (NPRC) shall be primarily responsible for national and international research development in the Nigerian Oil and Gas Industry with emphasis on the Gulf of Guinea and the Sub Region. It shall also assist in promoting capacity building and maximising local value added.
NATIONAL FRONTIER EXPLORATION SERVICES:
The National Frontier Exploration Services (”NFES” or “Frontier Service”) is a new entity created to regulate and stimulate petroleum exploration activities in the unassigned frontier acreages of Nigeria, which are defined within the PIB as being the the Anambra, Benue Trough, Bida, Chad, Dahomey, and Sokoto Basins of Nigeria.
PETROLEUM EQUALISATION FUND
The Petroleum Equalisation Fund (”PEF” or “the Equalisation Fund”) is the Fund into which any net surplus revenue recovered from petroleum products marketing companies (”the marketing companies”) and such sums as may be provided for that purpose by the Federal Government shall be paid. PEF is under the management of the Petroleum Equalisation Fund Management Board. The Board shall be responsible for determining the method by which net surplus revenue shall be collected from marketing companies; recovering such net surplus revenues from the sale of petroleum products from marketing companies. The Board shall receive the said net surplus revenue and hold it in safe custody and in trust for the reimbursement of the marketing companies for loss suffered loss solely and exclusively as a result of their sales of petroleum products at uniform benchmark prices set by the Authority throughout the country.
PETROLEUM TECHNOLOGY DEVELOPMENT FUND
The Petroleum Technology Development Fund is created for the purposes of training Nigerians to qualify as graduates, professionals, technicians and craftsmen, in the fields of engineering, geology, science, management and other related fields in the Nigerian petroleum industry or abroad. Also among other things, the Development Fund shall be utilised to:
a) provide, maintain and subsidise scholarships and bursaries, wholly or partially in universities, institutions, and in petroleum undertakings in Nigeria or abroad;
b) initiate, design and implement an effective indigenous research and development of capacity for Nigeria’s petroleum industry;
c) support, as the case may be, skill acquisition programmes aimed at enhancing employment in the petroleum industry in Nigeria;
d) enhance and develop infrastructure in tertiary institutions that provide courses of study relevant to the oil and gas industry;
e) to facilitate in-country fabrication and manufacturing of equipment used in the Nigerian oil and gas industry generally facilitate the attainment of 100 percent Nigerian Content in the Petroleum industry
FCC Unit of the Warri Refinery and Petrochemicals Company Ltd.
The work of the Oil and Gas Sector Reforms Implementation Committee (OGIC) has right from the onset focused on two key aspects of the implementation programme. This is meant to serve as the first phase of the reform exercise.
First and foremost was the determination to come up with a draft enabling legislation that would provide the required legal basis for the whole reform exercise. This is not only in keeping with the specific and expressed charge of the President while inaugurating the Committee in September, 2007; but also in recognition of the strict adherence to the Rule of Law by the administration of President Umaru Musa Yar’adua.
The other significant task the Committee devoted time on is designing the required framework for putting in place the new institutions that would operate the industry on behalf of the Nigerian Government. In this regard the Committee focused on coming up with the necessary functional structure for the new institutions. The other matters of focus by the Committee in this task are: the funding of the various institutions and the governance processes in all the organizations.
The work of the Committee on the Institutional Structure of the industry provides a wholesome picture of how the industry being envisaged by the National Oil and Gas Policy would look like. This is in terms of both the shape of the various individual institutions and in terms of the inter relationship between them.