Nigeria’s oil and gas companies are facing a significant debt burden, owing the federation a staggering $6.071 billion and N66.4 billion in unpaid taxes and royalties, according to the latest report from the Nigeria Extractive Industries Transparency Initiative (NEITI). This amount includes $6.071 billion and N66.4 billion in unpaid royalties and gas flare penalties owed to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) by August 31, 2024.
The report also reveals that oil companies’ liabilities rose to $6.175 billion as of June 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 N492.8 million as of June 2024.
The oil and gas industry saw a 9% drop in revenue in 2023, with $16.467 billion recorded compared to $18.106 billion in 2022. However, oil output increased by 9.5% in 2023, reaching 537.57 million barrels, up from 490.94 million barrels in 2022.
The NEITI report highlights the importance of transparency and accountability in managing Nigeria’s natural resources. Secretary to the Government of the Federation, Senator George Akume, praised NEITI’s work in promoting trust and accountability in the extractive industry.
The report also notes that the government paid N3.01 trillion as petrol subsidy in 2023, compared to N4.71 trillion paid in 2022. Furthermore, 23.54 billion litres of PMS were imported into the country in 2022, while 20.28 billion litres were imported in 2023, representing a 14% decline.
The NEITI report is considered a vital tool for identifying leakages, improving revenue collection, and promoting resource management reforms. The House of Representatives Committee on Petroleum Resources (Downstream) is working to amend the NEITI Act to grant it more financial autonomy.
