The Federal Government is set to scrap the Department of Petroleum Resources (DPR), Nigerian National Petroleum Corporation (NNPC), and Petroleum Products Pricing Regulatory Agency (PPPRA).
The Federal Government’s draft National Oil Policy has proposed to consolidate Nigeria’s oil industry regulatory authorities into one agency to be known as Petroleum Regulatory Commission (PRC).
According to the document released by the Ministry of Petroleum Resources over the 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 largely ineffective, weak 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.
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The document 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 (PRC) single petroleum sector regulatory authority will operate under the policy supervision of the Minister of Petroleum Resources.