A Review of the Nigerian Energy Industry

ERA accuses multinational oil coys of tax evasion

Gabriel Enogholase

04 October 2012, Sweetcrude, LAGOS – ENVIRONMENTAL Rights Action/Friends of the Earth, Nigeria, ERA/FoN, has accused multinational oil exploration and producing companies in the country of tax evasion and underpaying royalties to the government.

ERA/FoN’s Director, Programmes and Administration, Dr. Uyi Ojo, a political ecologist, quoting the audit reports of NEITI at a one day Community Town Hall Meeting/Media Parley with the theme: ‘NEITI: Holding Shell Accountable for Oil Impacts in the Niger Delta of Nigeria’, said, “So far, the NEITI Secretariat has successfully conducted three audit cycles, the latest being the 2006 – 2008 period.

“In the three reports, the following has been observed: – tax evasion and underpayments of royalties. In 2006, companies paid in $4,457.9 million while government received $4,418 leaving an unreconciled difference of $39.4million; short-payment and inconsistencies in the payment of Signature bonuses. From 2006 to 2008, the companies paid a total of $1,470.80million to government, while government received $1million, under declaring of oil pumped.”

He insisted that following the development, the oil companies, the Central Bank of Nigeria and the Nigeria National Petroleum Corporation had conflicting figures about the total earnings from petroleum.

While urging oil companies to publish what they got and the actual quantity of crude oil pumped from Nigeria daily, he disclosed that whereas the official figures fed to the Nigerian government stood at2.2 millions barrels of crude oil per day, what actually goes out was over 4 million barrels .

Commenting on the NEITI law of 2007, Dr. Ojo said, “We believe that the Act is mainly Industry driven and that is why there is a major focus on publishing what you pay to government.

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  • The FIRS must come alive to their responsibilities and ensure that monies owed the state are recovered in a timely manner. Similarly, government personnel who have conveniently turned a blind eye to the outstanding indebtedness and company executives who presided over the affairs of such companies when the debt was accumulated need to be prosecuted to the full extent of the law. tax evasion is a criminal.