The Nigerian Extractive Industries Transparency Initiative (NEITI) has revealed that the liabilities of oil companies to the federation have increased to $6.175 billion as of June 2024.
This was contained in the 2022/2023 oil and gas industry report, presented by the agency on Thursday in Abuja.
NEITI Executive Secretary, Dr Orji Ogbonnaya, said the details of the report were based on an audit of the petroleum industry conducted by the agency during the review period
It noted that in the last decade, the Federal Government spent a total sum of N15.8 trillion on price differentials and under-recovery (subsidy) on the importation of 200.85 billion litres of petrol into the country.
“A total of N15.87tn has been claimed as under-recovery/price differentials between 2006 and 2023, with 2022 recording the highest of N4.714tn,” the report read in part.
According to Orji, the released report was not just a document but a call to action, marking a significant milestone in the ongoing efforts to promote transparency, accountability, and good governance in Nigeria’s extractive sector.
“The report provides valuable insights that will help guide policy, encourage robust public debate, and ultimately improve governance in the management of our natural resources,” he said.
The report showed that the government spent a considerable amount of its resources to pay for price differentials, also known as subsidies, between 2014 and 2023, while its petrol imports surged yearly increasing the cost of subsidies.
The report disclosed that the government paid N3.01 trillion for the petrol subsidy in 2023 compared to N4.71 trillion paid in 2022.
It stated that a total of 23.54bn litres of PMS (Premium Motor Spirit) were imported into the country in 2022, while 20.28bn litres were imported in 2023. This represents a reduction of 3.25bn litres, or a 14 per cent decline, following the removal of the subsidy.
“A detailed 10-year trend analysis (2014–2023) shows that the highest annual PMS importation into the country, 23.54bn litres, was recorded in 2022, while the lowest, 16.88bn litres, was recorded in 2017. A total of N15.87tn was claimed as under-recovery/price differentials between 2006 and 2023, with the highest amount, N4.714tn, recorded in 2022,” it stated.
NEITI added that liabilities owed to the federation include $6.071 billion and N66.4 billion in unpaid royalties and gas flare penalties owed to the Nigerian Upstream Petroleum Regulatory Commission by August 31, 2024.
It further said there are outstanding petroleum profit taxes, company income taxes, withholding taxes, and VAT owed to the Federal Inland Revenue Service amounting to $21.926 million and N492.8 million as of June 2024.
