Nigeria: Acting president promises oil overhaul

By BASHIR ADIGUN

ABUJA, Nigeria

Nigeria's acting president on Monday called for the passage of a bill that analysts say would sharply reduce the profits of foreign oil companies.

Acting President Goodluck Jonathan said the Petroleum Industry Bill before lawmakers would allow more oil money to return to Nigeria's people. The bill would also require the government-run Nigerian National Petroleum Corp., to seek profits like a private business and not rely on government subsidies.

"Oil must be an agent for good and development not violence, war and impoverishment," Jonathan said at an oil and gas conference in Abuja, Nigeria's capital. "Our goal is to ensure that the benefits of petroleum be enjoyed and seen to be enjoyed by all Nigerians."

Jonathan's message is unlikely to be well received by companies exploring for oil off Nigeria's coast and its restive Niger Delta. Analysts have warned that the bill will cut drastically into oil companies' profits and make it uneconomical for them to continue their work in the nation.

Foreign oil companies Chevron Corp., ExxonMobil Corp. and Royal Dutch Shell PLC all have subsidiaries operating oil fields in Nigeria.

Jonathan said the proposed bill will also ensure that revenues from exploration are shared equally across the nation -- including the Niger Delta where militant violence and oil thefts have cut Nigeria's oil production by about 1 million barrels a day.

Militants demand the federal government send more oil money to Nigeria's southern region, which remains poor despite five decades of oil production.

Jonathan's comments also come as foreign oil companies are complaining government approval for their leases has stalled since President Umaru Yar'Adua left the country to receive medical treatment abroad.

While ExxonMobil already had its Nigerian oil field licenses renewed, Shell and Chevron still are in negotiations with the government. Shell also has announced its desire to sell off its rights to three oil fields.

Nigeria's is the third largest oil exporter to the U.S., behind Canada and Mexico.