THE indebtedness of oil companies to the Federal Government, in terms of royalties and taxes, has climbed to $6.175 billion, according to an audit of the petroleum industry conducted by the Nigeria Extractive Industries Transparency Initiative (NEITI).
The report on the oil and gas industry, released today in Abuja, revealed that $6.071 billion and ₦66.4 billion in unpaid royalties and gas flare penalties were owed to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as of August 31, 2024.
Additionally, outstanding petroleum profit taxes, company income taxes, withholding taxes, and VAT owed to the Federal Inland Revenue Service (FIRS) stood at $21.926 million and ₦492.8 million as of June 2024.
NEITI also reported a 9% decline in industry revenue for 2023, with $16.467 billion recorded compared to $18.106 billion in 2022.
The report disclosed a total loss of 7.68 million barrels of crude oil in 2023 due to theft and measurement errors, marking a significant 79% reduction from the 36.69 million barrels lost in 2022.
Furthermore, 153.44 million barrels of crude oil production were deferred in 2023, with SPDC (39.13 million barrels), TEPNG (6.07 million barrels), and TUPNI (3.5 million barrels) being the hardest hit.
It also revealed that the government spent ₦3.01 trillion on petrol subsidies in 2023, down from ₦4.71 trillion in 2022.
A total of 23.54 billion litres of PMS (premium motor spirit) was imported in 2022, while 20.28 billion litres were imported in 2023, representing a 14% decline following the removal of the subsidy.
“A 10-year trend analysis (2014-2023) shows that the highest annual PMS importation, 23.54 billion litres, occurred in 2022, while the lowest, 16.88 billion litres, was recorded in 2017. A total of ₦15.87 trillion was claimed as under-recovery/price differentials between 2006 and 2023, with ₦4.714 trillion, the highest amount, recorded in 2022.”
During the report presentation, Secretary to the Government of the Federation, Senator George Akume, assured stakeholders that the government would continue to allow NEITI to operate independently in line with its mandate under the global Extractive Industries Transparency Initiative (EITI).
“As Chairman of the NEITI Board, I emphasize the Federal Government’s respect for NEITI’s independence. My role signifies the government’s commitment to ensuring NEITI operates without interference, as mandated by EITI standards. Safeguarding this independence is essential,” said Sen. Akume.
Meanwhile, Chairman of the Economic and Financial Crimes Commission (EFCC), Olanipekun Olukayode, pledged to use the report to ensure the recovery of outstanding revenues from oil companies.
He noted that the EFCC recently recovered and remitted over ₦1 billion to the Federal Government based on previous NEITI reports.