Following Decembers release of the audit report of the oil and gas industry for 2016 by the Nigeria Extractive Industries Transparency Initiative (NEITI), BudgiT has demanded actions from the regulatory bodies in the extractive industries to step up their performance.
According to BudgiT the report indicated that 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 $7.82 million.
“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” the group noted.
The group also pointed out that NNPC failed to apply market rate as advised by the CBN to convert the sales proceeds received in US dollars for domestic crude sales, which resulted in a revenue loss of N260.43 million.
BudgIT further revealed that it discovered losses arising from crude oil theft and sabotage in the upstream and downstream sectors amounted to $869.02 million and $3.55 billion respectively.
“Similarly, in 2016, twenty-three companies incurred a liability of $3.63 million on gas flare penalty. This can actually be expended on four research and development projects in the oil and gas sector.
Also worried by this spate of loss, BudgIT called on all entities that have been identified with outstanding issues to resolve them immediately.
“We note with dismay that some of the issues have not only persisted but have also escalated over the years. We are charging all regulatory bodies of government to wake up to their responsibilities in ensuring compliance with the rules of engagement,” said Gabriel Okeowo, BudgIT’s Principal Lead.
He pointed out that if the financial resources loss is properly structured back into the economy it will go a long way in contributing to the economic recovery and growth plan of the federal government.
