According to the document released by the Ministry of Petroleum Resources, last weekend, the new regulator will incorporate the activities of the existing petroleum regulatory authorities and also cover some new regulatory activities not currently covered.
The document revealed that the existing institutional regulatory framework was weak, largely ineffective and inefficient, arising from a number of single-issue agencies; overlaps in regulation, gaps in regulation, mixture of policy, regulation and operations; and ineffective regulation.
It stated: “Although the agencies generally work well together, their roles, sometimes, overlap and there are significant information gaps within the government as, sometimes, one institution is unaware of what the other is doing.
“At the same time, policy making capacity has been weak, resulting in NNPC and its subsidiaries setting policy and regulation as well as conducting operations in the petroleum sector. The result is an ineffective and inefficient institutional environment in the petroleum sector in Nigeria.”
The draft policy is also proposing that, in order to reduce the inefficiencies in parastatals in the petroleum sector, the proposed single petroleum sector regulatory authority will operate under the policy supervision of the Minister of Petroleum Resources.
According to the document, the Minister will set the policy for the PRC; ensure monitoring of the implementation of the policy; and ensure monitoring of the performance of the authority.
“This does not mean that the regulatory authority will report to the Ministry on a day to day basis. The new single regulatory authority will be an operationally independent regulatory institution. The Minister’s involvement will be hands off and just to ensure that the regulatory authority properly carries out its roles of implementing the policy,” it explained.