ABUJA, July 19 (Reuters) - Nigeria's parliament has received the latest draft of a long-delayed oil law, which would restructure every aspect of Africa's largest energy industry, but it won't be debated until at least Sept. 17 due to lawmakers' annual holiday.
The Petroleum Industry Bill (PIB) is potentially the most important piece of legislation in Nigeria's history.
It could unlock billions of dollars of delayed investment, help boost oil production and promote interest in the world's seventh largest gas reserves, which are largely untapped.
But industry experts have warned that recent drafts have watered down and delayed many of the original reforms, which could limit the impact of the PIB, although most stakeholders agree that any law is better than the current uncertainty.
'By the time we come back (on Sept. 17) we will do the first reading, second reading and public hearing on the bill,' the Speaker of the House of Representatives Waziri Tambuwal said.
'Mr President had said this very important bill would be presented to the national assembly on or before the end of June. We have just received the bill ... please note that this delay was not caused by the national assembly,' Tambuwal said on the floor of the house.
When parliament returns from recess various committees will analyse the bill and given the widespread nature of the law it could take several months of debate and consultations with experts, as well as a public hearing, before it can be passed.
The PIB has been in the making for more than five years but powerful vested interests blocked progress while lawmakers, oil companies and the federal government disagreed on terms.
The fact President Goodluck Jonathan has given this draft his backing raises the chance of it becoming law but by no means guarantees a quick passage because the legislature works independently and can be abrasive with the executive.
Other versions have stirred criticism from lawmakers, many of whom are concerned drafts were generous to foreign oil firms and gave too much power to the executive arm of government, primarily the oil minister and the president.
Many northern lawmakers will be unhappy with a provision which would give 10 percent of oil companies' net profits to a local community fund for the people of the oil-producing, southern Niger Delta.
Since the first draft of the PIB a northern-based Islamist sect has overtaken militancy in the Niger Delta as the biggest security risk in Africa's most populous nation and many northern politicians want funding to develop their communities.
There is already money allocated for the Niger Delta in the federal budget but communities there believe they should be given something for the oil beneath their feet.
Delays have caused uncertainty over the future framework of working in Nigeria, costing the industry billions of dollars of potential investment and the government much-needed revenues.
Without it, most analysts expect oil production in Nigeria to decline substantially over the next few years.
Nigeria exports more than 2 million barrels a day (bpd) of crude oil popular with U.S. buyers because it is light and easy to refine. China and India are also growing takers.
Foreign oil companies say Nigeria could produce 4 million bpd if the national oil company was better funded and insecurity and corruption were combated.