Debtors list : FG now owed N2.66trn by 77 oil and gas companies

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Factual Pursuit of Truth for Progress

 

About 77 oil and gas companies now owe the Federal Government over N2.66tn,the Nigeria Extractive Industries Transparency Initiative (NEITI)disclosed on Tuesday.

The Executive Secretary,NEITI,Orji Ogbonnaya-Orji,while speaking on the status of EITI implementation in Nigeria in Abuja said the 77 firms carried out their operations across the country.

Reports revealed that NEITI has threatened to publish fresh list of indebted oil firms that would give anti-corruption agencies including the Economic and Financial Crimes Commission to go after the defaulting organisations.

Ogbonnaya-Orji explained that the N2.66tn debt arose from failure to remit petroleum profit tax, company income tax, education tax, value added tax, withholding tax, royalty and concession on rentals.

He explained that the total liabilities of the 77 companies were captured in the agencies’ 2019 independent audit report of the oil and gas sector.

Ogbonnaya-Orji said, “The NEITI reports based on findings in its 2019 audit of the oil and gas sector show that oil and gas companies in Nigeria owe government about $6.48bn, which equals N2.66tn at today’s exchange rate of N410.35.

“A breakdown of the figures show that a total of $143.99m is owed as petroleum profit taxes, $1.089bn as company income taxes and $201.69m as education tax.

“Others include $18.46m and £972,000 as Value Added Tax, $23.91m and £997,000 as withholding tax, $4.357bn as royalty oil, $292.44m as royalty gas, while $270.187m and $41.86m were unremitted gas flare penalties and concession rentals respectively.”

The NEITI boss said the disclosure was important in view of the government’s current search for revenue to address the demand for steady power, good roads, quality education, fight against insurgency and job creation.

“A comparative analysis of what this huge sum of N2.66tn can contribute to economic development shows that it could have covered the entire capital budget of the Federal Government in 2020 or even be used to service the Federal Government’s debt of $2.68bn in 2020,” Ogbonnaya-Orji stated.

He added, “In 2021, if the money is recovered the N2.66tn could fund about 46 per cent of Nigeria’s 2021 budget deficit of N5.6tn and is even higher than the entire projected oil revenue for 2021.”

This, he said, was why NEITI had decided to work with the government to provide relevant information and data to support efforts at recovering this money.

“We therefore appeal to these companies to ensure that they remit the various outstanding sums against them before the conclusion of the 2020 NEITI audit cycle to the relevant government agencies responsible for collection and remittances of such revenue,” he stated.

The transparency agency boss cautioned oil firms that NEITI would no longer watch while these debts continued to remain in its reports unaddressed.

He stressed that NEITI would provide all necessary information and data to sister agencies and anti-corruption organisations whose responsibilities were to recover the debts into government coffers.

We are partnering EFCC, NFIU to recover N2.66tn from oil firms, says agency
On whether the agency was partnering law enforcement agencies to recover the N2.66tn from the 77 companies, Ogbonnaya-Orji replied in the affirmative.

“We will also share the information and data with our partner anti-corruption agencies with whom we have signed MoUs,” he said.

He explained that in the past seven months, NEITI had held series of meetings and consultations with diverse stakeholder groups involved in the EITI process.

He said, “The outcomes of these engagements have culminated in the signing of Memorandum of Understanding with some of them to support NEITI in the implementation of the EITI in Nigeria.

“MoUs were signed notably with the Economic and Financial Crimes Commission; Independent Corrupt Practices and Other Related Offences Commission; and the Nigerian Financial Intelligence Unit.”

Ogbonnaya-Orji also stated that agency was strengthening the powers and functions of NEITI through an amendment of the NEITI Law enacted since 2007.

He said the amendment was to align the law with EITI emerging issues, the new Petroleum Industry Act and ongoing reforms in the industry.

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