National transport bill is passed to leverage emerging trends in sector reforms

Member, House of Representatives and Chairman, Technical Advisory Committee (TAC), Rowland Ocholi Ataguba, explains the benefits of the Railway Bill and National Transport Commission Bill passed by the House recently. In this interview with Paul Efiyong, the lawmaker also outlines the challenges ahead for the transport sector. Congratulations on the More...

by Peoples Daily | Published 2 years ago
By Peoples Daily On Wednesday, April 5th, 2017

By Etuka Sunday The Nigeria Extractive Industries Transparency Initiative (NEITI) has urged the Federal Government to put urgent machineries in motion to recover over $21 Billion unremitted funds disclosed by its independent reports of the extractive industry, to fund the country’s economic recovery plan. In a policy brief which focused on unremitted funds, economic recovery and oil sector reform, NEITI noted that the recovery of these huge unremitted funds is more than enough to jump-start the economy. According to the NEITI Policy Brief: ‘‘Findings from a series of audits of the oil and gas sector carried out by the Nigeria Extractive Industries Transparency Initiative (NEITI) shows that NNPC and its upstream arm, NPDC, have failed to remit $21.778 billion and N316.074 billion to the Federation Account. These are amounts due from three main sources: Federation assets divested to NPDC and NPDC’s legacy liabilities; payments for domestic crude allocation to NNPC; and dividends from investment in Nigerian Liquefied Natural Gas Company (NLNG) paid to but withheld by NNPC. Recovery of these funds will significantly enhance government’s fiscal position in the short term.’’ The NEITI brief urged the government to go beyond recovery of these funds to putting in place adequate measures to ensure: Revaluation of the assets divested to NPDC to determine the actual market prices with a view to recovering the full value of these assets and securing optimal benefits from them; Review of the relationship between NPDC, NNPC and the Federation to determine and establish effective lines of accountability of NNPC’s subsidiaries, and determine optimal mode of operation in line with global best practices; Review of the process of acquisition of OMLs by NNPC and NPDC to ensure that long-term net positive value is realized given the availability of alternative economic options. A breakdown of the unremitted funds disclosed by NEITI reports of the oil and gas industry over the years include outstanding payments of $1.7billion arising from the transfer of eight OMLs from Shell Petroleum Development Corporation (SPDC) and the sum of $2.2million from four OMLs from Nigeria Agip Oil Company to the Nigeria Petroleum Development Company respectively. NEITI reports disclosed that the NPDC is yet to pay for these major national assets that were transferred for its commercial operations. Also contained in the breakdown of unremitted funds is cash call paid on the transferred OMLs amounting to about $148.28million. This is in addition to legacy liabilities amounting to the sum of $1.5Billion and the huge sum of $15.8billion unremitted to the Federation account from accrued NLNG dividends between 2000 and 2014. A breakdown of the outstanding recoverable sum of over $21.8 billion and N316 billion is shown in the table below: The NEITI policy brief recommended a comprehensive review of the transactions to conform to EITI accountability principles: ‘‘NEITI’s review of transfer of the country’s oil assets to NPDC also shows that these decisions were not underpinned by sound economic judgment. Although NPDC was established to foster indigenous participation in the upstream sector, it is not really able to produce at substantial levels on its own. In mid-2006, total output from its wholly owned production was just 10,000 bpd. On the other hand, production from its service contract agreement with Agip was 65,000 bpd. Reasons given for NPDC’s disappointing performance include: undue interference by NNPC, inadequate financial structure, inability to source project finances. These bottlenecks in indigenous production seem to have led to the current strategy of the NPDC entering into partnerships with both international and indigenous oil companies who do the actual exploration and production on NPDC assets. Despite NPDC’s clear operational and capacity deficiencies, the company continues to be allocated valuable concessions of Nigeria’s most productive OMLs.’’ On the NLNG dividends, the NEITI policy brief noted with concern that while there is evidence of payment of dividends from NLNG to NNPC, there is no similar evidence to show that NNPC remitted the dividends to the Federation account as required by sections 80(1) and 162(1) of the constitution. According to the NEITI policy brief: ‘‘NLNG operates as a private company run by its private partners. Despite owning majority shares, the government of Nigeria is not involved in its management but earns revenues from its investment in the enterprise in form of dividends, interests and loan repayments. Since the Federation’s shareholding in NLNG is held through NNPC, dividends are paid to NNPC, which should remit same to the Federation. However, NEITI audits have revealed that until 2015, NNPC has failed to remit the interests and dividends from NLNG to the Federation Account. For the period between 2000 and 2014 NLNG paid a total of $15.8 billion to NNPC, which NNPC acknowledged receiving but failed to remit to the Federation Account’’, the Policy Brief concluded. NEITI therefore recommended urgent measures to recover the funds to support the on-going economic recovery plans. ‘‘Total unremitted revenues to government’s treasury amounted to $21.778 billion and N316.074 billion. At current exchange rate, this comes to about N7.2 trillion. Achieving a recovery rate of just 20% would significantly offset the projected deficit for the 2017 budget. A third of the computed unremitted revenues would completely eliminate the need to borrow to finance the budget. This has both short and long-term positive implications for the economy.’’

The Speaker of the House of Representatives, Rt. Hon. Yakubu Dogara The Speaker House of Representatives, Rt Hon. Yakubu Dogara, needs no introduction. In this 2nd part of the interview we run last week, he eloquently More...

By Peoples Daily On Tuesday, August 30th, 2016

Edo APC governorship candidate to introduce e-governance, block leakages

Alhaji Abdulmalik Ahmed Usman is the Chairman of All Progressives Congress (APC) in the Federal Capital Territory, Abuja. In this exclusive interview with Paul Efiong he speaks of his party’s plans to ensure that More...

By Peoples Daily On Wednesday, August 24th, 2016

Alleged N750 m car purchase scam was blown out of proportion – Benue Majority Leader

The Benue State House of Assembly has recently been enmeshed in an alleged N750 million car purchase scam that saw the Economic and Financial Crimes Commission, EFCC, swoop on members. However, in an interview with More...

By Peoples Daily On Monday, August 15th, 2016

For the first time in my life, I’m confident that Nigeria under Buhari is safe – Oyegun

National chairman of the ruling All Progressives Congress (APC), John Odegie Oyegun recently clocked 77 years. In this interview with some selected journalists in his office, he speaks about his life and some national More...

By Peoples Daily On Monday, June 13th, 2016

Senate needs to focus more on c’ttee works – Sen. Abu Ibrahim

The Senator representing Katsina South in the Senate, Abu Ibrahim, who is also the Chairman, Senate Committee on Police Affairs in this interview with journalists, examined the performance of the 8th Senate during More...

By Peoples Daily On Tuesday, May 31st, 2016

Gov Masari’s administration is meeting peoples expectation – Info Comm

Hamza Muhammad Brodo is the current Commissioner of Information in Katsina State. In this interview with selected journalists, Brodo spoke on the one year achievements of Governor Masari’s administration. Lawal More...

By Peoples Daily On Monday, May 30th, 2016

Sheath your sword – Marafa tells N/Delta Avengers

Kabiru Marafa represents Zamfara Central in the Senate, in this interview with Peoples Daily, he urges Niger Delta Avengers to sheath their sword. Excerpts: On the crisis in Niger Delta area, where militants are More...

By Peoples Daily On Monday, May 23rd, 2016

Our IPP project not meant to victimise members of opposition in Zamfara- Commissioner

Alhaji Ahmad Sharu Anka is one of the young but experienced politicians who came into the Zamfara State political arena through the pressure of the youth. He contested and won the local government elections in Anka More...

By Peoples Daily On Friday, April 15th, 2016

Saraki’s group may move out of APC – Baraje

Why have you remained silence on issues affecting APC? My silence was because I am an elder of the party and elders don’t just talk, particularly the ones that know what they are doing and I don’t believe in More...