Oil, gas coys owe federation accounts N1.32trn in 2020 –NEITI

The Nigerian Extractive Industries Transparency Initiative (NEITI) has said the liabilities of oil and gas companies with the Federation Accounts as of December 31, 2020, were N1.32 trillion.

Dr Orji Ogbonnaya Orji, Executive Secretary of NEITI unveiled this on Monday in Abuja at the public presentation of reports on Oil, Gas and Mining as well as Fiscal Allocation and Statutory Disbursement.

Orji, while highlighting the 2020 oil and gas reports, said the number of companies in default fell from 77 in 2019 to 51 in 2020.

The executive secretary described the current debts as collectable income that was owed to the accounts of the federation, the Upstream Petroleum Regulatory Commission (NUPRC) and the Federal Internal Revenue Service (FIRS).

The latest report also outlined the specific revenue streams represented by the liabilities in question, including oil royalties, gas royalties, concession rents, and oil revenue taxes.

Others include corporate tax, value-added tax and withholdings at source, among others.

He explained that the disclosure of the companies’ liabilities is in line with its mandate and in compliance with its obligation as a member of the global Extractive Industries Transparency Initiative (EITI) and not against the companies.

Ogbonnaya said the report reveals that Nigeria earned $20.43 billion from the sector in 2020, adding that the figure represents a 40 per cent decrease compared to the $34.22 billion earned in 2019.

“On remittances to the federative accounts of the sector, the report also revealed that $14.65 billion were remitted to the accounts, which represent 71.17 per cent of the total profits in 2020.

“While the total official flows added from the sector to the government in 10 years (2011-2020) was 394,029 million dollars,” he said.

It also said that total crude oil production in 2020 was 646.7 million barrels (mmbbls), which represents a decrease of 12 per cent compared to the 735.24 mmbbls produced in 2019.

Of the previous total production in 2020, it noted that 648.48 mmbbls were extracted, adding that this was 11.85% lower than the 735.66 mmbbls obtained in 2019.

Regarding the fuel subsidy, he said that the report further showed that N106.9 billion was paid as a subsidy between January and June 2020 to maintain product availability with an outstanding balance of N26.74 billion still to be paid.

According to him, 20.01 billion litres of gasoline, 52 million litres of kerosene and 5.33 billion litres of diesel have been imported into the country for domestic use during the period under review.

On oil theft and crude losses, he said the report made an assessment based on data provided to NEITI by the 69 companies covered.

According to him, according to the result of the assessment, 29.16 mmbl of crude oil valued at $44.73 million (N15.71 billion) were stolen and 349 cases of pipeline vandalism were recorded in 2020, an improvement compared to the 1,387 cases in 2019.

Regarding gas production, he said that he revealed that the gas subsector contributed more than 1.5 billion dollars to the federation’s account.

He said gas production in 2020 was 3.01 million cubic feet, of which 64% was sold, 8% flared, and 4% unaccounted for.

“The report also showed that the oil and gas sector contributed only 8.16% of the total Gross Domestic Product (GDP) in 2020. This represents a decrease of 0.4% compared to the 8.62% registered in 2019.

“The report also showed that the sector dominated the country’s exports in 2020, contributing around 75 per cent (N9.44 trillion) of the total export value of N12.52 trillion,” it said.