Nigeria has recovered $3.8Billion (N1.5 trillion) out of a total of US$6.477 billion (N2.6 trillion owed it by 77 oil companies.

Mon, Aug 29, 2022
By editor

Oil & Gas

ACCORDING to the Nigeria Extractive Industries Transparency Initiative, NEITI, over US$2.67 billion (N1.07 Trillion) is still outstanding. 

Ogbonnaya Orji, executive secretary, NEITI, stated this while delivering  a special industry address  at the Association of Energy Correspondents of Nigeria, NAEC, Strategic International Conference in Lagos, last week.

Orji spoke on the topic “Transparency and Accountability a Key to Sustainable Energy Sector: The Role of Nigeria Extractive Industries Transparency Initiative, NEITI”.

Represented by Obiageli Onuorah, assistant director, Communications & Advocacy, Orji stated that Nigeria must mainstream transparency, accountability mechanisms into her energy transition agenda.

According to him, Nigeria must be prepared to mainstream transparency and accountability mechanisms into her energy transition agenda to avoid the pitfalls of her past and present energy circumstances.

He  commended NAEC  for choosing the broad theme of: “Energy Transition, Shaping the Future of Nigeria’s Energy Industry: An Appraisal of the Petroleum Industry Act, Evolving Benefits and Challenges” for this year’s Conference. Which  he said is  very apt, given the unfolding developments and emerging realities both in the global and domestic energy industry.

‘’As the world moves from fossil fuel to cleaner and sustainable energy, it must be noted that transparency and accountability will be central to efforts to support the transition process.

“This will include the reporting of emissions, the disclosure of climate risks and the overall governance of the future energy industry. Therefore, Nigeria must be prepared to mainstream transparency and accountability mechanisms into her energy transition agenda to avoid the pitfalls of her past and present energy circumstances,” he said.

He affirmed that NEITI has a major role to play in a sustainable energy sector for the country and is already working with its partners to help stakeholders gain full insights and deepen public knowledge on the risks and opportunities that are associated with the transition within our national context through timely disclosures and dissemination of extractive industries data and information. 

Realnews reports that the agency, considering the multi-sectoral nature of the energy transition, is galvanising the needed inter-agency cooperation and national consensus for a sustainable energy sector.

Orji noted that already NEITI through the EITI has engaged a consultant to advise it specifically on energy transition. Together with the Natural Resources Governance Institute, our global affiliate -the EITI and BudgIt, we are planning a National Dialogue on Energy Transition on the 6th of October. This Dialogue will bring together national and international experts to brainstorm on Nigeria’s contextual reality as it concerns its transition to a low carbon, cleaner and renewable energy future.

‘’As you are aware, the decision by our government to sign on to the global Extractive Industries Transparency Initiative, EITI, and establish the Nigeria Extractive Industries Transparency Initiative, NEITI, was informed primarily to address the challenges of the resource curse in our country’s energy sector. Over the years, NEITI has been doing this through regular conduct of industry audits, disclosures and wider dissemination of vital credible and verifiable information and data from the sector to the public.’’

‘’The belief is that unimpeded access to timely information and data about the country’s oil, gas and mining sectors by the citizens, media and other accountability actors will promote public debate on the management of the sector, foster civic actions, accountability and ultimately sustainability in the sector. ‘’ he noted.

‘’Today, I can say with every sense of modesty that the impacts of NEITI leading sweeping reforms in the industry are visible for everyone to see. NEITI has led a reform revolution in the opening of the sector for citizens’ scrutiny by providing reliable information and data in the public domain which has helped the media and civil society to push the boundaries of constructive engagements, promoted public disclosure, dialogue and debates in the management of the sector.

On legislation, NEITI reports recommended the Petroleum Industry Bill now an Act of Parliament. We are also currently serving on the Presidential Steering Committee to ensure the effective implementation of the new law. The landmark impact of the PIA is the ongoing transition of the NNPC to a commercial enterprise as recommended by all previous reports of NEITI. The NNPC has also joined the global EITI as a supporting company. ‘’ Orji stated

He said that NEITI is also supporting the government’s drive to increase revenues through thorough reconciliations of data of operators in the nation’s extractive sector, push for renewal of obsolete MoUs and fiscal regime of the sector and other policy advisory roles to government. 

It would be recalled that during the recent release of the NEITI industry reports of the oil and gas sector, we reported that 77 companies in the oil and gas sector in Nigeria owe the federation a total of US$6.477 billion (N2.6 trillion). That report could have gathered dust on the shelves unnoticed. But you – the media picked up the news and ran with it. 

“The result is that the House of Representatives set up an Ad hoc Committee to investigate, recover the outstanding debts and conduct a proper reconciliation of accounts between the Federal Government and the Oil Companies. I am glad to report that over $3.8Billion (N1.5 Trillion) has been paid while over US$2.67 Billion (N1.07 Trillion) is still outstanding. This is just one of the impacts of our partnerships with you. I can name many more,” he said.

The NEITI reports have also led to the activation of the solid minerals revenue account. From this account, revenues are shared to the federation using laid down constitutional provisions including the payment of 13% derivation to solid minerals producing states as it is done for the oil and gas sector. 

‘’Let me use this opportunity to place on record that the modest achievements and successes so far recorded by NEITI would not have been possible without the unflinching support of members of NAEC. The work you do daily, covering and reporting the oil and gas sector is very important to our operations and mandate. NEITI and NAEC are natural allies with common interests in the areas of transparency, information disclosure, dissemination and accountability in the energy sector. 

He called on all energy correspondents to familiarise themselves with the contents of the PIA, work more closely with NEITI to use the legislation as an important tool to rescue Nigeria from the resource curse through effective implementation of the new law. NEITI will conduct relevant training for energy correspondents on the EITI process, the NEITI mandate and the roles of the media in the effective implementation of the PIA.