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Dr. Orji Ogbonnaya Orji, the Executive Secretary of Nigeria Extractive Industries Transparency Initiative (NEITI) says the agency has devised fresh plans to collaborate with the government to provide relevant information and data to support efforts at recovering N2.659 Trillion owed the federation by 77 oil and gas companies in Nigeria.
He also said the agency is pursuing the review of NEITI Act to align with the Petroleum Industry Act, recently signed into law by President Muhammadu Buhari.
Orji ,who disclosed this while briefing the media on the status of EITI implementation in Nigeria during the agencies mid-year briefing and presentation of its scorecard in the past seven months, said the NEITI Act is inconsistent with the PIA Act, and the review of the Act, will not only strengthen the law in line with PIA Act, but also equip the agency with relevant powers to recover the monies published in its annual audit reports.
He said:”I committed to strengthen the powers and functions of the NEITI through an amendment of the NEITI Law enacted since 2007. The amendment is to align the Law with EITI emerging issues, the new Petroleum Industry Act and on-going reforms in the industry. 77 oil and gas companies in Nigeria are indebted to the federation to the tune of N2.659 Trillion Naira. The debt arises from failure to remit petroleum profit tax, company income tax, education tax, value added tax, withholding tax, royalty and concession on rentals.
“It is important that the process of recovering this humongous sum be set on course to support government in this period of dwindling revenues” he said.
Orji explained that the total liabilities of the 77 companies covered by the NEITI process was at the agencies’ 2019 independent audit report of the oil and gas sector.
He said NEITI reports based on findings in its 2019 audit reports of the oil and gas sector show that oil and gas companies in Nigeria owe government about $6.48Billion which equals about two trillion, six hundred and fifty nine billion Naira (N2.659Trillion) at today’s exchange rate of N410.35.
He added: “A breakdown of the figures show that a total of $143.99million is owed as petroleum profit taxes, $1.089billion as company income taxes and $201.69Million as education tax. Others include $18.46Million and £972Thousand as Value Added Tax, $23.91million and £997Thousand as Withholding Tax, $4.357billion as royalty oil, $292.44Million as royalty gas, while $270.187Million and $41.86Million were unremitted gas flare penalties and concession rentals respectively”.
Orji said that the disclosure was important and timely in view of the government’s current search for revenues to address citizens’ demand for steady power, access to good roads, quality education, fight insurgency and creation of job opportunities for the country’s teeming youths.
He also said that a comparative analysis of what this huge sum of N2.65trillion can contribute to economic development shows that it could have covered the entire capital budget of the federal government in 2020 or even used to service the federal government’s debt of $2.68billion in 2020.
He added:“In 2021, if the money is recovered the 2.659trillion could fund about 46% of Nigeria’s 2021 budget deficit of N5.6Trillion and is even higher than the entire projected oil revenue for 2021.
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