A Review of the Nigerian Energy Industry

NEITI urges Buhari to recover N1.4tn from oil companies

10 June 2015, Abuja – The Nigeria Extractive Industries Transparency Initiative has called on President Muhammadu Buhari to consider the recovery of over $7.5bn (N1.4tn) from oil and gas companies operating in the country as a major priority of his economic policy agenda expected to be unfolded very soon.

Zainab Ahmed, Executive-Sec, NEITI
Mrs. Zainab Ahmed, Executive Secretary, NEITI

The agency said in a statement issued on Tuesday that the amount represented clear cases of underpayment and under-assessment of taxes, royalties and rents revealed by NEITI in its independent audit reports on the industry, which had not been adequately addressed.

The statement quoted the Executive Secretary, NEITI, Mrs. Zainab Ahmed, to have made the call in Abuja at an oil and gas conference to articulate an agenda for the new administration in support of the proposed industry reforms.

She explained that at a time when the new administration was in dire need of funds to tackle complex problems facing the nation, recovery of the amount should be pursued vigorously with political will and the seriousness it deserved.

Ahmed gave the assurance that NEITI was ready and willing to provide every information and data to assist the government to recover the funds.

She also said that a total of $11.6bn, which represents outstanding total dividends arising from loans and interest repayment from Federal Government’s investment in Liquefied Natural Gas, also needed to be recovered into the government’s coffers.

She said, “Our 2012 audit report discovered that total dividend, loans and interest repayment from the LNG paid to the NNPC in 2012 was $2.8bn; however, in the course of NEITI’s audit, the NNPC was unable to provide any evidence that the funds were remitted to the Federation Account as required by law.

“The total amount received by the NNPC from the LNG under the same circumstances, which has not been remitted to the Federation Account, stands at $11.6bn.”

Ahmed also used the forum to call for full investigation into the transfer of eight oil wells sold by Nigerian National Petroleum Corporation to the Nigeria Petroleum Development Company in 2010 and 2011.

“The position of NEITI is that the whole transaction is not transparent,” she added.

She also used the forum to convey NEITI’s position for the removal of oil subsidy on petroleum products in order to save the nation from huge revenue loss and embarrassment that the management of the subsidy scheme represented.

“It has been the position of NEITI that the oil subsidy regime is a fraud that should not be allowed to stand any longer; the amount spent annually is enough to repair the refineries or even build new ones,” Ahmed said.

The NEITI boss advised the new administration to provide the political will required for the implementation of the other findings and recommendations contained in the agency’s independent reports.



– Punch

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