Post Views: 571 BudgIT, a civic organization that seeks societal change, while applying technology to intersect citizen engagement, on Tuesday lamente...
BudgIT, a civic organization that seeks societal change, while applying technology to intersect citizen engagement, on Tuesday lamented the poor regulation of the nation’s oil and gas industry leading to revenue losses in excess of $5bn, as shown in the 2016 annual audit report of the Nigeria Extractive Industries Transparency Initiative (NEITI).
This huge amount that lost annually, if properly ploughed back into the economy, BudgIT noted, it will significantly contribute to the Federal Government’s economic recovery and growth plan.
A critical assessment of the report by NEITI, a body charged with improving transparency and accountability in the management of revenues from natural resources, released last December, BudgIT noted in its statement, for example, put losses arising from crude oil theft and sabotage in the upstream and downstream sectors at $869.02m and $3.55bn respectively.
Salient analysis of the report requiring actions from regulatory bodies in the sector, BudgIT said, included the fact that 23 companies incurred a liability of $3.63m on gas flare penalty, enough for four research and development projects in the oil and gas sector.
“From the report, there were three cases of under-remittance in the first quarter of 2016 in which unit prices and crude values on the sales invoice were higher than the recorded figure in the sales profile, amounting to an aggregate revenue loss of $7.82m. From our analysis, this revenue loss, alone, can be used to build and equip almost 500 hospitals in oil-rich but devastated communities in the Niger Delta region,” it added.
Also, the statement noted the failure by the Nigerian National Petroleum Corporation (NNPC) to apply market rate as advised by the Central Bank of Nigeria (CBN) to convert the sales proceeds received in US dollars for domestic crude sales. This, it said, resulted in a revenue loss of N260.43m, just as an under-remittance of N4.02m was also observed in 2015 due to similar practices.
Worried by the spate of loss, BudgIT challenged all entities identified with outstanding issues to resolve them immediately, lamenting that some of the issues have not only persisted but have also escalated over the years.
The statement quoted Gabriel Okeowo, BudgIT’s Principal Lead as challenging “all regulatory bodies of government to wake up to their responsibilities in ensuring compliance with the rules of engagement.”