A Review of the Nigerian Energy Industry

NEITI recovers $2.4bn unpaid oil revenue

Zainab Ahmed, Executive Secretary, NEITI
Zainab Ahmed, Executive Secretary, NEITI

*Task team demands review of 445,000bpd of crude allocated to NNPC

Oscarline Onwuemenyi

09 December 2014, Sweetcrude, Abuja – The Nigerian Extractive Industries Transparency Initiative, NEITI, on Monday disclosed that a total of $2.4 billion has so far been recovered by the Inter Ministerial Task Team, IMTT, set up by the federal government to trace outstanding revenue due to it in various forms from operations in Nigeria’s oil and gas industry.

This is even as the IMTT has said that an additional $540 million was recovered in August 2014 from oil and gas companies which were found to have underpaid government in the various audits of the Nigeria Extractive Industries Transparency Initiative (NEITI), which brough the total to $2.4 billion.

The NEITI Executive Secretary, Mrs. Zainab Ahmed, who made the disclosure at the meeting organised by the Civil Society Legislative Advocacy Centre, CISLAC, said the efforts of the task team were gradually yielding results despite the seemingly slow pace in addressing remedial issues identified in the various NEITI audit reports.

Represented by NEITI Community Outreach leader, Mrs. Obiageli Onuorah, Ahmed explained that since its reconstitution to include high ranking officers of relevant government agencies such as the Nigeria National Petroleum Corporation, NNPC, Department of Petroleum Resources, DPR, and Federal Inland Revenue Services, FIRS, the IMTT has made significant progress.

She said the IMTT, which has focused more on issues relating to bid rounds and signature bonuses as well as crude oil sale and accounting for transactions, has received support from the World Bank on these priority areas. Ahmed further added that the task team has made proposals to government on adopting standard practices in managing government’s share of crude oil revenue.

The proposals according to her include that the NNPC must apply the official exchange rate approved by the Central Bank of Nigeria in invoicing domestic crude allocation to it as well as the formalisation and approval by relevant parties for NNPC to deduct from source all subsidy claims using approved templates.

The IMTT, Ahmed added has also recommended that the federal government should consider a review of the daily allocation of 445,000 barrels per day of crude allocated to the NNPC for domestic refining to the level of available local refining capacity.

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