The Federal Government (FG), through the Nigeria Extractive Industries Transparency Initiative (NEITI), has declared its intention to recover a total debt of N2.659trn from 77 oil and gas firms operating in Nigeria, in its bid to improve the Nigeria power sector and execute other important national projects, with the recovered fund.
Dr Orji Ogbonnaya Orji, Executive Secretary, NEITI, during the agency’s mid-year media briefing on the state of the country’s EITI implementation and presentation of its scorecard for the past seven months, on Tuesday, disclosed that the N2.659trn debt was accumulated by the 77 firms, over the years, due to their failure to remit Petroleum Profit Tax (PPT), Education Tax, Withholding Tax (WHT), Value Added Tax (VAT), Company Income Tax (CIT), royalty and concession on rentals, to the Federal Government.
He also told the media that the FG has to take the bold step, at this moment, as it needs funds to carry out many crucial national projects and initiatives that are geared towards developing the Nigerian economy, including addressing current national security challenges, road construction projects, providing quality education and job opportunities to Nigerian youths, across the states.
“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.
“This is why NEITI is set to work with the government to provide relevant information and data to support efforts at recovering this money.
“The disclosure of this information is in line with NEITI’s mandate to conduct audits, disseminate the findings to the public to enable the citizen’s especially the media and civil society to use the information and data to hold government, companies and even society to account,” he said.
Dr Orji gave an analysis of the accumulated debt, during his speech. He said, “The NEITI reports, based on findings in its 2019 audit reports of the oil and gas sector, show that oil and gas companies in the country owe the government about $6.48 billion which equals N2.659 trillion at today’s exchange rate of N410.35/$.
“The breakdown of the figures shows that a total of $143.99million is owed as PPT; $1.089billion as CIT and $201.69million as education tax.
“Others include $18.46million and £972,000 as VAT, $23.91million and £997,000 as WHT, $4.357billion as oil royalty, $292.44million as gas royalty, while $270.187million and $41.86million were unremitted gas flare penalties and concession rentals respectively.”