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THE ROLE OF DOMESTIC SUPPLY OBLIGATION AND PUBLIC SERVICE OBLIGATION IN PROMOTING ENERGY SECURITY.   
An article by Olivia Chinonso Ihemeson Esq.

Content                                                                                                                     Page
                                                                                                                                               

Obligation (PSO) In Promoting Energy Security                                     15

Bibliography                                                                                                             26

INTRODUCTION
1.1  Background to the Study
In the world today, the prevalent energy sources are petroleum, coal, natural gas, biomass, and nuclear fuels, accounting for more than 80% of global primary energy consumption. Nigeria is the most populous nation in Africa, estimated at 211,968,966 and the seventh most populous nation in the world.  Nigeria, as a political entity, operates a federal system of government with 36 states and a federal capital territory situated in Abuja. The Nigerian energy industry is central to the country’s economic growth and development; energy is crucial to all sectors of the economy. The energy industry is the cornerstone of economic growth and development in Nigeria. Nigeria is fortunate to have huge energy resources and this gives the country sufficient opportunity to thoroughly revamp its economy and transform the lives of its citizens. Energy plays an essential role in the nation’s economy and serves as a commodity traded to earn national income. It also serves as a diplomatic and political instrument serving the nation’s manufacturing, transportation, health, education, and agricultural sectors. Nigeria has an enormous supply of natural energy resources in both fossil and renewable energy sources. The country’s economy is largely dependent on the oil and gas sector which now accounts for 95% of Nigeria’s foreign exchange earnings, 80% of government revenue, 50% of national gross domestic product, and oil remains the principal source of foreign direct investment inflows in Nigeria. The oil and natural gas industries are primarily located in the Niger Delta region. Nigeria is Africa’s energy giant. It ranks as the continent’s largest oil producer and the 8th largest exporter of oil in the world. Nigeria’s proven oil reserve stood at 35 billion barrels with 2.5 million barrels per day production capacity, while natural gas reserves stood at 183 trillion cubic feet (placing Nigeria among the first ten countries with the largest gas reserves) at the end of March 2014. Nigeria is endowed with other primary energy resources which include: tar sands (31 billion barrels oil equivalent); coal and lignite (estimated to be 2.7 billion tonnes). Nigeria is also blessed with abundant renewable potential energy resources such as solar, wind, hydroelectric, biomass, and tidal. These renewable resources, however, are largely left unexploited and their viability unrealized For example, the country has exploited only 20-28% of its entire hydropower capacity, the total 5.5KW-hr/m2 /day of solar radiation is not utilized, and wind energy resources remain unexploited. Despite the enormous domestic endowments of renewable and non-renewable energy resources, the country experiences persistent and insufficient quantity, low access to energy and poor quality. Nigeria has been plagued with an inability to provide affordable, adequate and reliable energy despite it being endowed with ample energy resources. The Nigerian domestic energy market is still largely underdeveloped with demand being constrained by inadequate energy supply infrastructure.

1.2    Research Methodology
The Research Methodology adopted in this paper is the Doctrinal Research Methodology. Doctrinal method of research means the type of research conducted with the aid of books, statutes and cases and thereafter makes findings and recommendations. The research will be conducted from both primary and secondary sources of law. Primary source, such as statute with particular reference to the Petroleum Industry Act, 2021. Secondary sources such as books on the study, articles, journals and online materials.

2.0  CONCEPTUAL FRAMEWORK     
2.1    Definition of Terms
In order to have a clear picture of the topic under discourse, it is imperative to dissect some key phrases for purposes of ease of comprehension. Hence, phrases such as “Domestic Supply Obligation’, ‘Public Service Obligation’ and ‘Energy Security’ as used in the topic shall be placed under a thoughtful binocular and given conceptual meaning and analysis.

Generically, Domestic Supply Obligation could be referred to a resource availability mechanism of the host State or government, giving an order imposing obligation on the oil and gas companies to provide the resources to the local consumers. It is said to be an Obligation imposed by the government or authority on the suppliers and distributors of energy sources in order to protect consumer’s interest or welfare by supplying adequate quantity to the domestic market. It is important to note that phrases such as ‘The Role of Domestic Supply Obligation’, ‘Public Service Obligation’, and Energy Security are combination of words conjoint in the phrases. Hence, it is more beneficial to separate them for purposes of definition and conceptual cognition.

Role
A role could be said to mean a set of connected obligations, rights, norms, beliefs, and behaviours as people conceptualized in social circumstances. Role is pivotal to the functionalist and interactionist understanding of society. According to Biddle, the role theory is a sociological study of role evolution with regards to the forces behind peoples’ behavior. Biddle posits 5 model role theory. They are: Functional Role Theory, which examines role development shared social norm for a given social position; Symbolic Interactionist Role theory, which examines the development of roles with regards to outcome of  individual reactions and responses to behaviour; Structural Role Theory, which bothers on societal influence rather than individual; Organizational Role Theory, which examines the development of role in organizations; and Cognitive Role Theory, which was summarized by Flynn and Lemay as the relationship between expectations and behaviours. Drawing the function of the cognitive role theory, which is the relationship between expectations and behaviours, the provision of the DSO and PSO in the PIA, if enforced, is expected to impose energy security behavioural change in the oil and gas industry. Under the foregoing context, ‘role’ refers to the function, importance, significance influence or impact of the PIA to Domestic Supply Obligation, and Public Service Obligation towards the realization of energy security in Nigeria.

Domestic
Our laws did not define domestic, the meaning of the term will be sought from dictionaries. ‘Domestic’, is defined by the Black’s Law Dictionary ‘as or relating to one’s own country or jurisdiction’. It is also defined by the New International Webster’s Comprehensive Dictionary of English Language as ‘belonging to the house or house hold; concerning or relating to the home or family’. This means that ‘domestic’ in the context of the paper, refers to the nation state of Nigeria.

Another key word in the phrase is ‘supply’. In Economics, supply is the quantity of resources that financial assets providers, firms, producers, labourers and other economic agents are willing to bring to the market place. Supply is said to mean the giving or furnishing of something needful or desirable. It could also mean the amount of goods produced or available at a given price. It appears therefore that, domestic supply means “the supply of particular resource into the same locality where it was found. It follows therefore that, the distribution of electricity, gas, fuel, water and so on, domiciled in a State or country within the same State or country is referred to as ‘domestic supply’. Worth noting is the fact that the word supplier, instead of supply, was given meaning under the interpretation section of the PIA to mean, the holder of a wholesale gas supply licence, wholesale petroleum liquids supply licence or, retail gas supply licence. Hence this paper draws the meaning of the term in the context as used under the Act to mean the distribution of a resource.

Obligation
Obligation refers to a course of action required of a person, organization, or the general public to follow. There are different kinds of obligations. They include written obligation, which binds two parties to a contract; political obligation, which requires citizens to obey the laws of that political society; and Social Obligation, which individuals obey because it is collectively accepted. Obligation, whether legal or moral, are constraints. Obligation is a legal or moral duty to do or not to do something. This means any statutory provision or customary precepts stating what and what not to do, places obligation on the people within the jurisdiction or sphere of operation of the law or custom. In the context of this paper, the party (s) under obligation to equitably distribute resources as stipulated by the Petroleum Industry Act appears to be the oil and gas companies and refinery operators. It is pertinent to note that, while the oil and gas companies and the refinery operators are under obligation to distribute energy resources for the public consumption, the public is equally under obligation to pay for services rendered.

Public
For the students of public relations and communication sciences, publics means, group of individual people, while public, is the totality of the groupings. This concept is at variant from the sociological concept of (Offentlichkeit) which denote public sphere. The concept of public, in public relations and communication science, is regarded as the most ambiguous concept in the field. The concept of public, in public relations and communication science has suffered more blurry attributes due to its conflation of idea of a public with the notions of audience, market segment, community, constituency and so on. The word public pertains to, or affecting the people at large or the community.’ It equally means the people of a nation or community as a whole. The term ‘public’ is said to have originated from the Latin word ‘Publicus’, also spelt ‘poplicus’, which denotes mass population. Note however, that, the word public was neither separately and specifically defined nor given a statutory meaning. Therefore, its meaning will be deciphered as used in the phrase in the context of this paper, which is referred to the Nigerian public.

Service
Service has been given different meanings, thus, means different things to different people and situations.
Service is seen as an intangible transaction where no material chattel passes from the seller to the buyer. The interest though, is laced in the buyer’s readiness to make the exchange. Public services on the other hand are referred to as the services the nation state, union, or region pays for service rendered. This means that services denote the payment of money to the service provider for the service rendered. The Black’s law Dictionary, defines service as the formal delivery of writ, summons or other legal process. The Webster’s Dictionary defines service as the rendering of assistance to someone in need. Under interpretation section of the PIA, ‘Service’ means the ‘Federal Inland Revenue Service’. But because the meaning of the word “service” alone as given under the interpretation section may not portray what is needed in the context, the meaning of ‘service’ will be drawn from the meaning given to Public Service Obligation under the interpretation section. Under the interpretation section, Public Service Obligation means specific obligation imposed by the Authority on Licensees in relation to security of supply, social service, economic development, environmental protection or the use of indigenous materials. It appears that that the word “service” as used under the interpretation section denotes Licensees’ rendering of supply services to the public as may be directed by the Authority. This also mean that the public must pay for the services rendered.
           
Energy
Energy is said to be the engine that propels the wheel of modern developments. The energy sector is the sum totality of energy generation industries. It comprised of the fossil fuel industry, the electrical industry, and the nuclear power industry. The fossil fuel industry includes companies involved in the exploration and development of oil and gas reserves, oil and gas drilling, and oil and gas refining, and oil and gas distribution. It also includes the integrated power utility companies such as coal and renewable energy. From the explanation above radiated, it appears that non-renewable energy includes but not limited to fossil fuel, gas kerosene and coal. Another section of the energy sector is the electrical power industry. This includes electricity generation, electric power distribution, and sales. There is also the nuclear power industry. One other and most trending energy industry is the renewable energy. It is comprised of alternative energy and sustainable energy companies such as the hydroelectric power energy, wind power energy, solar power energy. Lastly is the traditional power energy based on the collection and distribution of firewood. Looking at the importance and role of the energy industry to development, it appears that, the energy industry is the major source of environmental pollution. Oil is said to have been used for more than 5000 years. Oil energy is mostly used in cars and other different automobiles. In the context of this paper, ‘energy’ refers to oil and gas in Nigeria.
           
Security
Security is freedom from, or resilience against potential harm or other unwanted coercive change propelled by others. It is most especially referred to hostile forces. Therefore, the absence of harm, such as freedom from want, secure foundations, secrecy of telephone lines, secure room or cell, and the state of mind which is emotional security amongst others are what is referred to as security. However, the word ‘security’ in the context of this paper which is ‘energy security’, refers to the presence or condition of availability, affordability, reliability, and sustainability of energy resources at any point in time, for the customers or consumers.

Having separately explained the meaning of Domestic, Supply, Obligation, Security, Public, Energy, and Service, it is imperative to understand the conjunctive meaning of the phrases forming the topic of discourse. These are: Domestic Supply Obligation (DSO), Public Supply Obligation (PSO), and Energy Security (ES), in the context of the Petroleum Industry Act.

Domestic Crude Oil Supply Obligation is provided for under the PIA . Also, Power is vested on the Commission to make regulation for domestic gas delivery obligation. Under the Petroleum Industry Act, ‘Domestic Supply Obligation’ means ‘the obligations of an upstream crude oil producer to dedicate a specific volume of crude oil towards the domestic refineries.

2.1.1   Domestic Supply Obligation (DSO)
Generally speaking, Domestic Supply Obligation is an energy security mechanism of the host nation’s government, placing a compelling order on the operators to provide a certain percentage of the resources to the local end-users at an acceptable or affordable price. According to Taverne, provision of Domestic Supply Obligation in a nation’s legislation, vests power on the national authority to demand for the contractor to sell a percentage of the production share for purposes of settling domestic need upon emergency circumstances. For the UK Department of Energy and Climate Change, a design of Domestic Supply Obligation mechanism creates atmosphere which allows energy suppliers to have multiple delivery routes, with wide range partnerships response to the policy. The contribution of Goldberg to the discourse is that, DSO is an imposed obligation by the resource host government upon the suppliers and distributor to relinquish a certain percentage of the product for the domestic consumption to protect their welfare and interest.
2.1.2   Public Service Obligation (PSO)
In the context of the European Union, Public service obligation is a concept formulated to impose an obligation upon an organization by legislation or contract for the provision of service that will serve general interest within the European Union. The importance of public service obligation to serve the interest of the public led to the formulation of the German Public Service Obligation Regulation, 2005 to regulate air flights. This is pursuant to Council Regulation (EEC) No. 2408/92 for the Schedule air services within Germany. In view of this, the German government imposed obligation on the air flight providers to increase their flight routes within Germany. The Irish Commission for Energy Regulation is not left out of providing a DSO mechanism for Ireland. The aim is to impose an obligation on energy suppliers in order to ensure security of supply. The Irish PSO comes with obligation targeted on the public to pay levies. For public service obligation is the obligation placed on the public to pay for services rendered. It is germane to note that the Nigerian Petroleum Industry Act 2021 provides for public service obligation.

2.1.3  Energy Security (ES)
Energy security is the association between national security and the availability of resources for energy consumption. Overland, further contributed that, the nature of international energy relations has played a pivotal role in energy security and vulnerability simultaneously. This is factual evidence because, energy rich nations do cut energy supply from the dependent states causing energy disruption. It appears therefore that, the rapid development of renewable energy is the only thing that will bring energy security and sustainability. This is because, the energy source in not controlled by another nation that is vulnerable to disruption, once it is fixed. Mitchel is of the view that energy security entails reliability, affordability, avoidance of foreign policy constraints, and environmental friendliness. According to Goldberg, energy security may mean different things to different people at different situation due to its connectivity with economic, social, political, environmental, foreign policy and military. For the EU, energy security includes the availability of energy during emergency, a free and sustainable market system, diversification of source of energy supply and efficient distribution strategy. Elkind, on the issue of energy security, is with the opinion that, availability means amongst others, resource endowment, capital investment, a robust legal and regulatory framework and consumers’ ease of access to the product in the market. Elkind propounds four criteria referred to as the ‘Elkind criteria’ which stipulates that a sustainable energy security propagates availability, reliability, affordability and environmental protection sustainability. For Dike, the importance of environmental sustainability as being part of energy security cannot be over emphasized. He buttressed further that, petroleum is the main pillar with regards to energy security policy, as well as meeting global energy demand, especially the transportation sector. He however pointed out that, petroleum industry is a major contributor to environmental degradation impacting on climate change. Dike again stated that, deficient of a robust legal regime that provides for domestic consumption in an affordable, reliable, and sustainable manner equally amounts to energy security threat. For Yergin, the availability, sustainability access to resource, and timely distribution for domestic use is the basis of energy security. On issues bothering the environment, section 102 provides for the operator to within 1 year or 6 months upon approval of lease or licence for the up and the midstream sector, submit to the Authority or the Commission, the environmental safety plan for approval. There is no specific set up standard under the Act as a guide for the operators.

3. 0   LEGAL AND INSTITUTIONAL FRAMEWORK
3.1 Legal Framework
3.1.1Petroleum Industry Act, 2021 (PIA)
The petroleum industry Act, 2021 provides legal, governance, regulatory and fiscal framework for the Nigerian petroleum industry and development of host communities. It contains 5 chapters, 319 and 8 schedules dealing with rights of preemption; incorporated joint ventures. Domestic base price and pricing framework, pricing formula for gas, price for the gas-based industries; capital allowances; production allowances and cost price ration limit; petroleum fees, rents and Royalties; and creation of the ministry of petroleum incorporated.
Amongst many provisions contained in the PIA are provisions for the domestic supply obligation contained also is the provision for public service obligation.
These are policies formulated to enhance domestic supply for the improvement of energy supply for Nigeria.
3.1.2  Federal High Court Act
The Federal High Court Act confers jurisdiction on the Federal High Court to exercise both civil and criminal jurisdiction and powers in respect of matters listed under section 251 (1) (n) Constitution of Federal Republic of Nigeria, 1999: mines and minerals (including oil fields, oil mining, geological surveys and natural gas)

3.2  Institutional Framework

3.2.1 Federal Ministry of Petroleum Resources
The federal ministry of petroleum resources is a part of the federal ministries of Nigeria that directs petroleum resources and its activities in Nigeria. The mandate of the ministry is to formulate policies, supervise their implementation and regulate the Nigerian oil and gas (energy) industry.
It exercises supervisory role over the operators and stakeholders, to ensure compliance with all applicable laws and regulations in the oil and gas sector and this by extension to the DSO and PSO contained in the PIA as policies for the insurance of energy security in Nigeria.

3.2.2   The Niger Delta Development Commission
The NDDC came into being in the year 2000 by former President Olusegun Obasanjo. The commission targets amongst other things to offer a lasting solution to the socio-economic difficulties of the Niger Delta region and to facilitate the rapid and sustainable development of the Niger Delta into a region that is economically prosperous, socially stable, ecologically regenerative and politically peaceful. This invariably includes the sustainability and energy security of the Niger Delta region and beyond.

3.2.3   Federal High Court
The Federal Revenue Court (as Federal High Court was then called) was established by the Federal Revenue Act 1973 (1973 No. 13). The Court was renamed the “Federal High Court” by section 228(1) and 230(2) of the constitution of the Federal Republic of Nigeria, 1979.

The jurisdiction of the federal high court includes adjudication of matters that relates to the revenue of the government particularly section 251(1)(n) allows the federal high court to deal on matters that involves mines and minerals that (including) oil fields, geological surveys and natural gas.

4.0  DOMESTIC SUPPLY OBLIGATION AND PUBLIC SERVICE OBLIGATION
4.1  Domestic Supply Obligation (DSO) in the PIA
For the first time in the history of Petroleum legislation in Nigeria, the Petroleum Industry Act (PIA) 2021, captures a DSO mechanism. Relating the objectives of domestic supply obligation to the current PIA in Nigeria, it is argued that, the provision of section 109 (1) did not provide adequately for domestic supply obligation. This is because of the phrase ‘a willing supplier’ . It could be argued that, if the supplier is not willing to supply, even though the buyer is willing, he is at liberty to so do. Domestic supply obligation objective is compelling and imposition of authority, and not discretionary. This paper also queries subsection (2) of section 109 which provides: ‘The Commission may’. The Act made use of the term ‘shall’ in other sections and subsections, but when it comes to issuing regulations and guidelines for the implementation of DSO, the word ‘may’ which suggest discretion, becomes the considered terminology. In the opinion of this paper, that depicts a deliberate intention not to implement DSO, which appears to make the PIA not different from other legislation with regards to DSO. Furthermore, the DSO mechanism captured under section 109 is upstream. This means that the DSO mechanism, even when it works, is for the benefit of refiners, not the end-users. The objective of DSO, in the opinion of this paper, has been defeated. The reason is because, the objective of DSO is intended for the benefit, interest, and welfare of end-users, and not the refineries. Put it in another designation, DSO imposes obligation on the distributors, including the refiners to make the product available for the general public. It is a mechanism formulated to protect the public, not distributors. The legislation did not specifically capture the objective of DSO to target the welfare and interest of the public.

It is observed that the PIA did not specifically state that, local consumption takes priority over export of oil and gas when there is no enough crude oil and gas, or a decline in production. Such specifically captured sections and subsections in the PIA are important as a means to regulate energy security and domestic supply obligation mechanism. It is therefore suggested that the Act should specifically and categorically state that, in a situation of low crude oil and gas production, operators and distributors ‘shall’ (must) satisfy domestic demand before export. This is the major aim and objective of Domestic Supply Obligation (DSO) in Energy Security.

4.2    Public Service Obligation (PSO) in the PIA
Section 171 of the Petroleum Industry Act 2021, provides for public service obligation. However, it appears there is no intention to implement the section because of the term ‘may’ that was used, which rather suggest discretionary pitch or tone. In order to have a crystal comprehension; and a better fathom about the tone in the provision, it is pertinent to reproduce the section verbatim.

The Authority ‘may’ issue regulations imposing public service obligations to licensees in relation to matters including-

Inferring into the importance of security of supply and environmental protection with regards to public interest on one hand, and the couching of the section using the word ‘may’, on the other, it appears government has no intention to implement and enforce DSO; and environmental protection in the PIA. To further expose the unwillingness of government to protect public interest, section 172, which imposed on the Authority to levy the public for the cost of supply, the word ‘shall’, became glorified. The word ‘shall’, is seen to have appeared in other sections and subsections, therefore, it is not accidental that the word ‘may’ found itself in sections 109 and 171. Considering the significance and relevance of these sections, rationality dictates that, it appears there is lack of goodwill to implement the PIA with respect to security of supply, environmental protection and health of Nigerians in the Act. This is worrisome especially for section 171 because, it deals with salient issues such as issuance of regulations and guidelines for security of supply, economic development, environmental protection and health and safety that will benefit the general public. It appears that, there is no intention on the part of government to cure the lacunas of previous legislation with regards to public health, energy security, security of supply, domestic supply obligation, and that of environmental protection. It is suggested therefore, that, the section be re-couched, and the word ‘shall’, be used instead.

4.3    Energy Security in Brazil
In Brazil just like Nigeria, ownership of oil and Gas is vested in the Federal Government. This is one of the similarities between Nigerian Petroleum industry and that of Brazil. The Brazilian constitution 1988 has an impact on Brazilian Petroleum Policy. Article 177, Item 1 provided that “The exploration for and production of oil and natural gas in the Brazilian national territory is a Federal Government's monopoly.” The constitution vest ownership of oil and gas, onshore and offshore in the Federal Government.

Another important legislation in the Petroleum industry in Brazil is The Brazilian Law No 9. 478 of 6 August 1997 (the Brazilian Act), which is responsible for the regulation of the Petroleum Industry.  The Act deals with energy policy in relation to oil, gas and bio fuels. The Act created the National Council for Energy Policy (CNPE). This excludes the state from having jurisdiction over petroleum, ethanol or biomass which is similar to the practice in Nigeria. The Act also creates the National Agency of Petroleum and Natural Gas and Bio fuels (ANP) which is responsible for regulating the circulation of Petroleum products and bringing violation of an economic nature to the attention of Council for Economic Defense for appropriate action.

The Act makes direct provision for security of Supply in Chapter 1, Article 1 which deals with the principles and objectives of the National Energy Policy. In support of the objectives of the CNPE specific measures have been proposed and they include:

To establish these objectives, Chapter III Article 3 made the following activities the monopoly of the Federal Government: exploration and production of Petroleum, natural gas, refining of Petroleum for domestic and foreign origin. These activities may also be carried out by authorization or by concessions. The duty to supply does not rest on the state alone but also on concessionaries.

The Act promotes reliability of Petroleum resources through the SINEC. It also makes provision for subsidy where necessary and provides for environmental protection.

The Brazilian Petroleum Act promotes transparency by engaging the municipalities in decisions affecting the industry. It addresses the problem associated with lack of transparency in petroleum revenue sharing in Nigeria through an equitable revenue disbursement to the petroleum sharing states, municipalities and the impacted local community areas. Chapter IV Section (IV) Articles 19 promotes public hearing before the initiation of any bill or the alteration of administrative norms affecting the right of economic agents, customers or users of goods and services of the petroleum industry and this stakeholder engagement which is appropriate for foreign investment in the Petroleum Industry. The bidding process for upstream activities is also transparent.

The Brazilian Petroleum Act encourages diversification to ethanol, nuclear and biodiesel and this reduces the dependency on Petroleum. The country has achieved energy independence by diversifying of energy sources.

5.0    SUMMARY OF FINDING, CONCLUSION AND RECOMMENDATIONS 
5.1    Summary of Finding
It was found among others that, though the PIA for the first time provided for DSO and PSO respectively, the provision was not robust and specific enough for a practical functionality of the mechanism. It was also found that the provision contemplated the distribution of the resources to the refiners and wholesalers instead of the end users. Again, it was discovered that, the provision for DSO focused on crude oil and gas to the exclusion of fuel. More so, it was found that, the term ‘may’ instead of ‘shall’ were used in some important sections of the Act, which suggested lack of goodwill to implement the
Act. Yet again, it was found that, the 30% profit to be used for oil and gas exploration at the frontiers is not economically viable. It was additionally discovered that, the absence of functional refineries in Nigeria will impede the objective of DSO for energy security. Furthermore, it was found that promotion of renewable energy to supplement during resource lack especially in the rural areas will enhance energy security in Nigeria. Lastly, it was found that the Act left important matter such as environmental protection into the hands of the operators of the industry without setting a standard for them.

5.2   Conclusion
The paper concluded that the PIA failed to specifically and categorically impose on the operators that energy must be provided for domestic use before export. Conclusion was also made that, the domestic supply regime in the PIA contemplated supply of resources to the refiners and wholesalers, and not the consumers (end users). Again, it was concluded that, domestic supply of fuel was omitted in the legislation. More so, the paper concluded that setting aside 30% for unascertained oil and gas exploration at the frontiers instead of renewable energy is not economically viable for the nation. Furthermore, it was concluded that having not set a standard with respect to environmental protection for the oil and gas operators to follow will continue to worsen the environmental degradation in Nigeria, especially in the Niger Delta region. Conclusion was also made to the effect that the use of the term ‘may’ instead of ‘shall’ in sections 109 and 171 of the Act is indicative of a legislation not with intention to implement and enforce the provisions.

5.3  Recommendations
The objective of DSO and PSO is for energy security. Energy security is when there is sufficient supply for domestic use. Therefore, it is recommended that, in order to realize a sustainable energy security, the Act should specifically and unambiguously provide that, in the event of low production of oil and gas in Nigeria, the operators must first supply enough for domestic use before considering export.

The provision under the PIA with respect to DSO contemplated supply of the resources to the distributors, refiners and wholesalers. Hence it is recommended that the Act be couched to impose upon the operators, an order to domestically supply fuel, gas, kerosene and other kinds of energy to Nigerians in order to protect the interest of the Nigerian public.

The obligation for domestic supply of resources was concentrated on crude oil and gas to the exclusion or omission of fuel. As a result, it is recommended that the DSO provision should cover supply of fuel as well.

Climate change is a global challenge, hence the trending of renewable energy. Therefore, it is recommended that 15% out of the 30% of profit set aside for oil and gas exploration in the frontiers be used for the development of renewable energy in Nigeria.

In order to realize a sustainable energy security in Nigeria and discourage monopoly, there must be a competitive refining mechanism. In that light, it is recommended that, the nation’s refineries should be made to function optimally.

 In legal drafting the term ‘shall’ is suggestive of a compelling obligation or duty, while ‘may’ is discretionary. Under the PIA, section 109 and 171 used the term may instead of shall. Hence, the recommendation that the term ‘shall’ be used in place of may in order to reflect the intention of the Act.
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Other Topics:

• The Rot in our Education System
• Environmental Impact Of Gas Flaring
• Noisy Worship
• A critical analysis of various landmark decisions of the Supreme court that impacted fundamentally on the concept of the party System in Nigeria
• PRINCIPLE OF CRIMINAL RESPONSIBILITY AND EXCUSING CONDITION OF CRIMINAL RESPONSIBILITY WITH SPECIAL REFERENCE TO INSANITY & INTOXICATION
• THE ROLE OF DOMESTIC SUPPLY OBLIGATION AND PUBLIC SERVICE OBLIGATION IN PROMOTING ENERGY SECURITY.   

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