Following a judgement by the Federal High Cout in Abuja nullifying the deregulation of the downstream sector of the petroleum industry yesterday, an expert in the oil sector has said that the federal government will appeal the verdict.
Justice Adamu Bello had in his judgement held that the federal government's deregulation policy of the downstream sector of the petroleum industry in Nigeria was unconstitutional, null and void.
The court also declared that the federal government lacked the power to deregulate the sector.
A Lagos-based lawyer, Mr. Bamidele Aturu, had filed the suit against the minister of petroleum resources and the attorney-general of the federation (AGF), challenging the legality of the deregulation of the oil sector. Justice Adamu Bello held that the government must always fix the price of petroleum products sold across Nigeria as stipulated in the nation's statutes.
The judge said, "Government's policy of deregulation of the downstream sector of the petroleum industry, by not fixing the prices petroleum products may be sold in Nigeria, is unlawful and a vicious violation of the provision of section 6 of the Petroleum Act, cap P.10, Laws of the Federation of Nigeria, 2004; and Section 4 of the Price Control Act, cap P28, Laws of the Federation of Nigeria, 2004".
However, the expert who would not want his name mentioned, told LEADERSHIP that the ruling by the court is insignificant as the new Petroleum Industry Bill (PIB) has provision for the regulation of the oil sector.
"The PIB provided for an institution that will regulate the sector.There is nowhere in the world where there is no regulation. All government needs to do is to appeal; once they (government) appeal it and show the provision for regulation in the new bill, that will be the end," he said.
He explained that the new PIB had technical and safety regulations as well as fiscal terms, which involved profit sharing as well as price regulation provisions that will guide the industry.
"So, if the industry will be regulated under the PIB, then there is no cause for alarm," he said.
The court's decision nullifies all that the government had done so far in furtherance of the deregulation process at the petroleum downstream sector.
Aturu had in 2009 challenged the decision of the government to stop fixing prices of petroleum products in Nigeria.
But the judge dismissed the objection of the government and the AGF and granted all the reliefs sought by Aturu and ordered the government to continue to fix, regulate and publish regularly prices of petroleum products across the country.
When contacted, over the court's ruling, the Nigerian National Petroleum Corporation (NNPC) said it was not in a position to comment on the judgement.
The corporation's general manager, media, Dr. Farouk Ibrahim, told LEADERSHIP on phone that the NNPC was not a party to the litigation, hence the corporation cannot react to the ruling.
"NNPC is not a party to the litigation. The Ministry of Justice and the Ministry of Petroleum were parties in the litigation. So, in a situation where we are not a party to a litigation we can't really express any opinion on the judgement," Ibrahim said.