Nigerian President Inaugurates New Oil and Gas Committee

In an attempt to radically change and rehabilitate the energy sector in Nigeria, two new committees have been inaugurated following the scrapping of the Nigeria National Petroleum Corporation (NNPC) and the Ministry of Petroleum last month.

President Umaru Yar'Adua inaugurated the Oil and Gas, as well as Power Reform Committees, under the auspices of the National Energy Council according to local reports.

But big companies with stakes in the Nigerian oil and gas industry will remain "cautious" according to UK analysts.

"There has always been a huge amount of caution [when working in Nigeria], both from a regulatory and operational perspective. I doubt the new reforms will assuage the concerns of companies," investment analyst for financial organisation Brewin Dolphin Investment Banking, David Macnair says.

The Oil and Gas Committee will be responsible for ensuring that the required legislative framework for oil and gas reform is undertaken ahead of the administration's planned restructuring programme.

The committee is also expected to advise on new bodies, institutions, organisations and agencies that will make-up the institutional framework for the restructuring of the oil industry, according to allafrica.com.

The Power Reform Committee is expected to review the country's existing power sector structure to make it more accountable, effective and efficient.

The country's federal government announced the scrapping of the NNPC at the end of last month leaving all major global oil partners unsure of current and future contracts in the region.

Nigeria is considered a significant global oil and gas player, producing between 3-4 million barrels of oil a day.

Reported by Ozge Ibrahim