FG Urgently Needs The $2 Billion In Debt That Oil Companies Owe – Neiti

Oil and gas companies have been ordered to pay the Federal Government more than $2 billion in debt, according to Orji Ogbonnaya Orji, Executive Secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI). Orji claims that the government is in desperate need of money to fund its numerous projects.

At yesterday’s NEITI-Companies Forum sensitization on Extractive Industries Transparency Initiative (EITI) validation, Orji provided the keynote address.

The country desperately needs the money, he said, so businesses should take all reasonable steps to pay their owed taxes, royalties, and rentals to the appropriate institutions.

“I am here to consult with leaders of the industry because the NEITI report currently, is channelled at helping the government to recover revenues that are owed.

“If we have over $2 billion that is outstanding, it is important we sensitise those who are owing to pay up because the government needs the money right now. We have moved from disclosing what is owed to what needs to be paid on time so that the government will have some money to fund projects. That is the target of NEITI at the moment, using our report to hold accountable companies that are owing the government.”

“We must also acknowledge the fact that companies are here for business and we are doing everything to support them. The issue of tax and concessions and royalties are statutory obligations that a good business organisation must be sensitive to. We don’t want any outstanding debt because the government is looking for money.”

Orji also pleaded with the businesses to abide by the agency’s rules, particularly the NEITI validation, a mechanism for quality assurance that is carried out every three years, which will take place in November and determine the degree of conformity with its requirements.

He warned that if the nation didn’t fulfill its obligations, it might lose its membership.

While NEITI lists the names of corporations that owe the government money, Bunmi Toyobo, Executive Director at Oil Producers’ Trade Section (OPTS) and Chairman Companies, said in a separate speech, payments made by companies should also be acknowledged.

“There should be a better understanding of the debt statements made in the media – if these are dues or outstanding. NEITI is supposed to be an impartial player in government. When they say companies have liability, they also need to mention those companies that have contributed certain billions of dollars to the government coffers,” he stated.

Toyobo further demanded that NEITI procedures be improved in order to spur business expansion and profitability.

He urged collaboration between the businesses and NEITI to help the country’s economy thrive, stressing that both parties should view one another as a partner in order to expand and contribute value.

He emphasized the operational issues that influence businesses and their operations, citing kidnapping, crude oil theft, and Joint Venture (JV) cash call arrears as examples.

Toyobo pointed out that over 80% of the oil produced in Nigeria is lost to theft, which has a negative impact on business operations. Some firms have stopped producing for nearly a year as a result of losses, he added.

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