A recent audit by the Nigeria Extractive Industries Transparency Initiative (NEITI) reveals that oil companies owe the Nigerian government $6.175 billion in unpaid royalties, taxes, and gas flare penalties. The report, presented in Abuja, covers the petroleum sector as of August 31, 2024.
NEITI disclosed that $6.071 billion in unpaid royalties and penalties are due to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), alongside ₦66.4 billion in gas flare penalties. Additional outstanding petroleum profit taxes, company income taxes, withholding taxes, and VAT owed to the Federal Inland Revenue Service (FIRS) amount to $21.926 million and ₦492.8 million.
The audit also reports a 9% decline in industry revenue for 2023, dropping to $16.467 billion from $18.106 billion in 2022. The sector faced significant challenges, with 7.68 million barrels of crude oil lost in 2023 due to theft and measurement inaccuracies—though this represents a marked reduction from the 36.69 million barrels lost in 2022.
### Subsidy Spending and Importation Decline
Nigeria’s government disbursed ₦3.01 trillion for petrol subsidies in 2023, a decrease from ₦4.71 trillion in 2022. Following the removal of fuel subsidies, the country saw a 14% drop in PMS (premium motor spirit) imports, declining from 23.54 billion litres in 2022 to 20.28 billion litres in 2023.
A 10-year trend analysis (2014-2023) highlights that the highest PMS importation occurred in 2022, with 23.54 billion litres, while the lowest, 16.88 billion litres, was recorded in 2017. A total of ₦15.87 trillion was claimed as price differentials between 2006 and 2023, with ₦4.714 trillion recorded in 2022 alone.
### Government and EFCC Pledge Action
Secretary to the Government of the Federation, Sen. George Akume, assured stakeholders that NEITI would retain its independence to fulfill its mandate under the global Extractive Industries Transparency Initiative (EITI). He emphasized the government’s commitment to transparency and accountability in the sector.
The Chairman of the Economic and Financial Crimes Commission (EFCC), Olanipekun Olukayode, pledged to recover the outstanding revenues from oil companies. He stated that the EFCC has already recovered over ₦1 billion based on previous NEITI reports.
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