Senior Advocate of Nigeria, Dr. Olisa Agbakoba, asserted that Nigeria must end structural contradictions in its oil governance framework by fully privatising the Nigerian National Petroleum Company and reclaiming control of oil revenues currently slipping through legal and operational loophole.
In an interview with ARISE NEWS on Wednesday, Agbakoba argued that although NNPC was converted into a limited liability company under the Petroleum Industry Act, it continues to function with the powers and posture of a statutory corporation, creating a legal and fiscal imbalance that undermines transparency and national revenue.
“The NNPC should be privatised, and I can understand that the NNPC is a registered concern under the CAC, but it’s at the same time the property of the Federal Government of Nigeria under the Minister of Finance incorporated, Murphy, with the President as the Minister of Petroleum Resources. There’s really a contradiction there.”
Agbakoba identified what he considers the central fiscal defect in the Petroleum Industry Act. “The part that is of concern is that part where NNPC takes about 70% of the revenue we generate from oil. Section 162 states that money due to the federation must be paid into the federal account. But what’s been happening is that NNPC, when it was a statutory corporation, would deduct 70%. And quite rightly the president has passed the EO9 to say you can’t do that. So that has to go. So even though I have a bit of quarrel with the EO because I’m not sure an EO that’s an executive order can override an act of parliament. Hopefully the Attorney General may be good proceeding to court. Actually I was looking to him to say what would be best is to go to court to ask the court to expunge the offending parts of the PIA that gives PIA access to our funds. Now we’re going to be saving about 45 trillion if that happens.”
He maintained that reform must go beyond executive directives and extend to judicial clarification of the Petroleum Industry Act. “When the decision was taken to decrypt the NNPC, it was made a limited liability company registered in CSE. But what the NNPC guys are doing is pushing back. So the government need not do anything. In fact, President Nduguwa has taken the correct decision by taking away a lot of their statutory functions and transferring it to the upstream and downstream commissions. Let NNPC go and get registered on the stock exchange and become like any other Nigerian oil company. NNPC cannot be operator and regulator at the same time, NNPC is gone. Go and fund the companies like all other Nigerian companies for whatever you want to do. And in that way, we will have a level playing field.”
Beyond institutional reform, Agbakoba framed the crisis as one of fiscal sovereignty and national survival. “The executive order should have also looked at the oil, international oil companies who fleece us by running our oil resources, depriving us of a huge revenue source. Now when that happens, we’ll begin to expand our funding requirements. When we expand our funding requirements, we lower our borrowing requirements. Right now we are borrowing to the extent of about 200 trillion.”
He proposed a shift from public sector borrowing requirements to public sector funding requirements. “I proposed to President two years ago ten major sources of income. I proposed to Zak Adeleke, who is the chair of the NRS, Actually I actually proposed the name NRS, but he’s gone a bit of the way by modifying our tax laws. So now we are earning about 40 trillion from tax. If we had to do a simple thing as titling properties, we’d be looking at 1.4 quadrillion over the next ten years. So when we do all of this, we are looking at close to 500 trillion. Remember I suggested to you gentlemen a while ago, you scoffed at it, that we could raise 500 trillion naira on a yearly basis. If we plugged all the loopholes, modified our laws, what does that do? All it did was to modify the 1930 base tax laws. And look what’s happening today.”
However, Agbakoba acknowledged that raising revenue alone would not resolve Nigeria’s development crisis. “It’s not enough to talk about raising revenue or capital formation, and then we’ll say, where does it go? Does it hit the people? Does it touch them? We need to strengthen the anti-corruption agencies, AFCC, ICBC, the police, and all relevant agencies that deal with government revenue, People are not feeling it. It’s not on the ground. It’s not enough for the Bureau of Statistics to release numbers in Abuja. I ask my driver every day, how do you feel? He says, I don’t feel good. That’s the key point.”
Right now, we have a situation where oil is not benefiting us. So once we’ve brought our money in, let’s lock it in first, and then we’ll talk about how to distribute, We need to break it up. We need to transfer the 68 items of power in the exclusive list. We need to take some and give the states. And then from the states, we need to also give some to the local government. So you have three important and effective governments of Nigeria delivering something good to Nigerian people. That will be a true federation.”
He concluded by urging political actors to focus on substantive economic and governance issues. “I hope these will be the big issues for 2027. It’s not all this defection. People are defecting from one party to the other. I want to hear big issues. I’m not hearing them.”
Erizia Rubyjeana
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