Nigeria scraps state oil company

Nigerian President Umaru Yar'Adua is to scrap the state-owned oil corporation and restructure the industry.
A national energy council will instead be established to oversee the notoriously corrupt oil sector.

The council, headed by the president, has six months to create five new organisations out of the Nigerian National Petroleum Corporation (NNPC).

Nigeria is the world's eighth-largest exporter of crude oil but relies on imports for its fuel needs.
There are often fuel scarcities and the subsidised price of fuel is regularly flouted.
The country loses millions of dollars of oil through illegal sell-offs, and reform of the oil sector is one of the newly-elected government's key aims.

Conflicting roles

The BBC's correspondent in Lagos, Alex Last, describes the NNPC as a behemoth of an organisation.

It produces crude oil in partnership with foreign oil companies, but also imports fuel and acts as a regulator and administrator of the oil sector.

With so many conflicting roles, the NNPC became synonymous with massive mismanagement and corruption, our correspondent says.

Unions and opposition parties have criticised the NNPC for a lack of transparency over imports and exports worth billions of dollars each year.

The new reforms were recommended by a government report seven years ago but never implemented.

However, there is some scepticism and it will take time before it is clear whether the reforms will bring real change or whether they turn out to be simply cosmetic, our correspondent says.

EU might restrict foreign access to energy networks: report

BRUSSELS : The European Commission is considering restricting access by foreign energy groups, especially from Russia, to EU networks, the Financial Times said Thursday.

Citing a confidential working paper, the British business newspaper reported that the EU executive is looking at imposing reciprocity clauses on countries such as Russia and Saudi Arabia that restrict EU investment.

That was one option under consideration for a package of proposals aimed at infusing more competition into the energy sector, which the Commission is due to publish on September 19.

Commission spokesman Ferran Tarradellas acknowledged that Brussels "has been taking into consideration the concept of reciprocity" in preparing the proposals.

As part of the package, the Commission is expected to propose so-called ownership unbundling or splitting up large European gas and electricity groups to separate their delivery businesses from generation and supply operations.

However, many member states are opposed to the idea, partly because of concerns that the new, smaller companies would be vulnerable to takeovers from non-EU companies eager to get hold of distribution networks.

Many of those concerns are focused on Russian state-controlled energy giant Gazprom, which is widely known to have ambitions of gaining market share in Europe.

Commission spokesman Tarradellas said that unbundling would apply to all companies, European and otherwise.

"If there is unbundling, there will be unbundling for everyone,"