Oil Companies’ Debt to Nigerian Government Soars to $6.175 Billion
A recent audit by the Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed that oil companies in Nigeria owe the federal government a staggering $6.175 billion in royalties and taxes. The report, presented in Abuja, also showed a 9% drop in industry revenue in 2023, with $16.467 billion recorded compared to $18.106 billion in 2022.
According to the report, oil companies owe the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) $6.071 billion and ₦66.4 billion in unpaid royalties and gas flare penalties as of August 31, 2024. Additionally, there are outstanding petroleum profit taxes, company income taxes, withholding taxes, and VAT owed to the Federal Inland Revenue Service (FIRS) amounting to $21.926 million and ₦492.8 million as of June 2024.
The report also highlighted a significant drop in crude oil production in 2023, with 7.68 million barrels lost due to theft and measurement errors, a 79% drop from the 36.69 million barrels lost in 2022. Furthermore, 153.44 million barrels of crude oil production were deferred in 2023, with companies like SPDC, TEPNG, and TUPNI being the most affected.
The report also showed that the government paid ₦3.01 trillion as a petrol subsidy in 2023, compared to ₦4.71 trillion paid in 2022. The report stated that a total of 23.54 billion litres of PMS (premium motor spirit) were imported into the country in 2022, while 20.28 billion litres were imported in 2023, representing a reduction of 3.25 billion litres, or a 14% decline, following the removal of the subsidy.
Speaking at the report unveiling, Secretary to the Government of the Federation, Sen. George Akume, assured stakeholders that the government would continue to grant NEITI the freedom to fulfill its mandate to the country and the global Extractive Industries Transparency Initiative (EITI). The Chairman of the Economic and Financial Crimes Commission (EFCC), Olanipekun Olukayode, also promised to use the latest report to ensure that the government recovers all outstanding revenues from the companies.
The EFCC Chairman announced that from NEITI’s past reports, the commission recently recovered and remitted over ₦1 billion to the Federal Government coffers.