…Says over 70% revenue from extractive industry
Oscarline Onwuemenyi 24 November 2015, Sweetcrude, Abuja – The Nigeria Extractive Industries Transparency Initiative (NEITI) has said it intends to monitor the extractive industries revenue transfers to the Treasury Single Account (TSA) of the government in line with its mandate to ensure that Nigeria gains and accounts for all its earnings from her extractive industries.
NEITI’s acting Executive Secretary, Dr. Orji Ogbonnaya Orji, who stated this at the fourth Sustainability in the Extractive Industries Conference, in Abuja, pointed out that its interest in the TSA is derived from its claims that about 70 per cent of funds transferred into it are from the country’s extractive sectors.
He noted that the agency was pleased with the government’s adoption of the TSA model to account for all its revenues but would also be interested in how it is operated.
“We are equally delighted that the present administration under the leadership of President Muhammadu Buhari has embraced the Treasury Single Account (TSA). The interest and concern of NEITI is that over 70 per cent of the revenues to be managed under TSA are derived from extractive industry,” Orji said.
He added that, “NEITI also commends the directive on remittance of loan repayment and dividends from the Nigeria Liquefied Natural Gas (NLNG) to the Federation Account. The reforms so far in the oil and gas industry inspire a lot of hope and optimism.”
Orji described Nigeria’s experience with managing her natural resources as complex, saying: “In Nigeria, our experience in extraction and management of our natural resources speaks eloquently for itself. Our experience is like an elephant, everyone has his own side of the story.”
According to Orji, NEITI is mandated by law to promote due process and transparency in extractive revenues paid to and received by government, as well ensure transparency and accountability in the application of extractive revenues.
The transparency agency is a national version of the global movement, the Extractive Industries Transparency Initiative (EITI) and it audits the operations of the country’s extractive sectors, oil; gas and solid minerals, to engender transparency in revenue transfers.
Orji, therefore, asked the government to extend its reform in the extractive industries to an alleged uneconomic transfer of about eight oil blocks by the Nigerian National Petroleum Corporation (NNPC) to its subsidiary, the Nigerian Petroleum Development Company (NPDC).
According to NEITI, the controversial oil blocks are Oil Mining Leases (OMLs) 4; 38; 41; 26; 42; 30; 40 and 34. It noted that they were transferred without consideration to value for money.
Similarly, Orji requested that the metering facilities used to measure the country’s crude oil should be reviewed, alleging that they are outdated and mostly used to short change government of its earnings from oil and gas operations.
“NEITI applauds the sweeping reforms so far carried out and expects that the new team in NNPC will find courage to implement all other NEITI recommendations.
“These include installation of modern and standard metering infrastructure to measure crude production, the pending issues of assignment of over eight oil wells by the NNPC to NPDC without consideration to value for money. The new team in the NNPC needs to conduct an investigation into this transaction as recommended by NEITI,” Orji added.