The introduction of the Petroleum Industry Governance Bill (PIGB), 2017 have necessitated reactions from various categories of individuals in the public. The bill, though, have been applauded as a welcome development in regulating the petroleum industry, has yet raised certain legal questions relating to the right of the Federal government to the ownership of oil and gas under section 44(3) of the 1999 constitution.

The PIGB, 2017 introduced certain fundamental matters through sections 61 & 66 of the bill. Section 66 provides thus;
Notwithstanding the provisions of section 61 of this Act, the government shall within five years from the date of incorporation of the National Petroleum Company, divest, in a transparent manner not less than 10% of the shares of the National Petroleum Company and within ten years from the date of incorporation divest not less than an additional 30% of the shares of the National Petroleum Company to the public in a transparent manner.

This section is to such effect as to ensure a more aggressive divestment and ultimately the transfer of not less than 40% of the shareholding right of the Federal Government to private sector.

However, section 44(3) of the 1999 Constitution provides thus;
Notwithstanding the foregoing provisions of this section, the entire property in and control of all minerals, mineral oils and natural gas in, under or upon any land in Nigeria or in, under or upon the territorial waters and the Exclusive Economic Zone of Nigeria shall vest in the Government of the Federation and shall be managed in such manner as may be prescribed by the National Assembly.

The foregoing provisions therefore raise three (3) fundamental questions;
What does “entire property in and control” mean in the light of the ownership right conferred upon the Federal Government.
Can the National Assembly divest 40% of the shareholding right of the federal government to private investors irrespective of the provision of section 44(3) of the 1999 constitution?
Can the National Assembly be said to execising its management power under section 44(3) of the constitution?

The term “entire property in and control” means having an absolute proprietary interest in mineral oil and resources. This is why section 1(2) of the Nigeria Minerals and Mining Act provide that all lands in which minerals have been found in commercial quantities shall from the commencement of the Act, be acquired by the government of the Federation.

If entire property in and control of mineral oil and resources are conferred in the Federal Government, the National Assembly cannot therefore divest such rights through the provisions of section 66 of the PIGB. To therefore divest 40% of the shareholding right under section 66 of the PIGB is in conflict with the provision of section 44(3) of the constitution. By the provision of section 1(3) of the 1999 constitution, the effect of this inconsistency will be that the provision of section 66 of the PIGB will be null and void to the extent of its inconsistency.

It must be stated that the National Assembly cannot be heard to hold that it is exercising its management power as provided under section 44(3) of the constitution. The management powers of the National Assembly will generally include making regulations in ensuring that the Federal Government acts within certain prescribed scope and power in the control of the mineral resources. The regulation power will not extend to limiting the power of the federal government to own mineral resources.

Conclusively, the House of Representatives should look into this fundamental matter before further passing the bill. The constitution is supreme and all Act of the National Assembly must be in line with the constitution.

Written by; Ogunsan Emmanuel Mayowa. He is a graduate of law from the Osun State University and currently awaits law school admission for the 2017/2018 session, E-mail: ogunsan.mayowa@yahoo.com

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