Petroleum Industry Bill In Nigeria: An Analytical View From Accounting and Economic Perspective

Abstract

The draft of the Petroleum Industry Bill 2020 that is expected to be passed by the Nigeria Senate before the end of 2021, as good as it sounds, has generated a lot of uproars and controversies. This study aims to critically analyze the draft Petroleum Industry Bill, from the accounting perspective, with regards to its effects on the operations of the Nigeria’s Oil and Gas Sector. The study is applied research involving both quantitative and qualitative methods. The quantitative aspect made use of descriptive explanations using percentages and the qualitative aspect adopted narrative and explorative method. Secondary data such as a draft copy of the Petroleum Industry Bill, and Statistical Data from OPEC were used. The findings show that, from the accounting perspective, the Petroleum Industry Bill 2021 would create a peaceful business environment by aligning the interest of the host communities to those of the oil companies and government through the host community fund; and full commercialization of NNPC and funding concessionaries and facility management operators. The findings also reveal controversies surrounding the bill, from accounting perspective, in the areas of increased cost of doing business in the fiscal provisions, retroactive reversal of contracts, and calculating payments. From the findings, the paper recommends that the bill be passed and accented into law by the Nigeria Senate and President respectively as its benefits outweigh the controversies. However, the researcher is of the view that to ensure harmony and general acceptance the controversial areas of the bill should be looked into and cushioning provisions made to assuage the negative effects on those concerned.