20 Years After, NEPZA to Hands off Oil and Gas Free Zones

• 20 Years After, NEPZA to Hands off Oil and Gas Free Zones

Exactly 20 years after the Oil and Gas Export Free zone Act No. 8 of 1996 established the Oil and Gas free Zones Authority (OGFZA) to manage and regulate the Oil and Gas Export Free Zones in Nigeria, the Nigeria Export Processing Zone Authority (NEPZA) is to relinquish the management of the oil and gas free zones to OGFZA.

It was gathered that though the licensing, monitoring and regulation of Free Zones Scheme in Nigeria is vested on the NEPZA by the Nigeria Export Processing Zone’s Act 63 of 1992, the Oil and Gas Export Free Zone Act of 1992 has ceded the powers of NEPZA in the management of oil and gas free zones to OGFZA.

Section 5 (2) of the Oil and Gas Export Free Zone Act of 1996 states that “the authority shall have power to take over and perform such other functions being hitherto performed by NEPZA as they relate to export of oil and gas from any of the Nigerian Export Processing Zones established by Nigeria Export Processing Zone Act.”

It is in the light of the above, it was learnt, that the new Managing Director of OGFZA, Mr. Umana Okon Umana has written to the Managing Directors of the Snake Island Integrated Free Zone (SIIFZ), LADOL and NEPZA, intimating them of OGFZA’s intention to take over the management of the oil and gas free zones in exercise of its statutory mandate.

The letters, dated November 17, 2016 also stated that the official take-off date for the management of the zones by OGFZ will be 30 days from the date of the letters.

In one of the letters with reference number FZA/SIIFZ/02/VO1/1116/001, the position of OGFZA is that “the authority has by virtue of the statutory provisions stated in Section 5 (2) and other relevant laws as well as the directives of the Government on the take-over of all Oil and Gas related activities within Free Zones in Nigeria, decided to carry out the full implementation of the law and the said directives. LADOL Free Zone, being an oil and gas free zone, will henceforth be licensed and regulated by OGFZA.”

Apart from the OGFZA Act which mandates OGFZA to manage the Oil and Gas free zones, Umana also cited the Free Zones (Monitoring and Regulations) Order 2014, which states that “as from the commencement of this order, the Authority (OGFZA), in addition to its functions under the Act, shall be responsible for (a) Licensing of all oil and gas free zones located with the Customs Territory; and (b) publication of all operating standards to be observed in the free zone from time to time.”

Umana also said his agency derived its powers from the White Paper on the restructuring and rationalization of Federal Government parastatals.

According to him, the Government White Paper on the Report of the Presidential Committee on Restructuring and Rationalisation of the Federal Government Parastatals, Commissions and Agencies of March 2014, states as it affects the Ministry of Industry, Trade and Investment in Section 236-237 (OGFZA and NEPZA) that: “Government rejected the merger of Oil and Gas Free Zone Authority (OGFZA) with Nigeria Export Processing Authority (NEPZA) and directs further that OGFZA be renamed Oil and Gas Free Zones Authority, Nigeria, with responsibility to regulate all oil and gas free zones in Nigeria.”