Wow! Oil companies owe Nigeria N1.57 trillion, greater than our capital budget

by Stanley Azuakola

On Friday, the Country Chair of Shell in Nigeria, Mutiu Sunmonu expressed his dissatisfaction with the current Petroleum Industry Bill before the National Assembly.

But before he goes about lamenting the bill, we wonder what his opinion is about revelations from the Nigeria Extractive Industries Transparency Initiative (NEITI), which audits the oil sector. NEITI has averred that oil companies, including Shell, owe the federal government $9.81 billion (about N1.57 trillion) in non-remittance and under payment of taxes between 1999 and 2008.

Spokesman for NEITI, Ogbonnaya Orji, revealed this in a statement on Monday.

Orji said: “The $9.81 billion in debt, which was accumulated between 1999 and 2008, have remained because the agencies responsible for their collection have not made adequate efforts to recover them.”

About a week ago, on September 19, NEITI started an audit of documents relating to payments made by companies against receipts from relevant government agencies between 2009 and 2011.

Oil companies submitted documents relating to oil production and taxes paid to the government during the period. Some of those who submitted documents include Shell, Eni, Chevron, ExxonMobil, Total, Addax and ConocoPhilips, Conoil, and the NNPC. It was in the process that the backlog of non-remittances and underpayment was discovered.

To put the amount in context, consider that for the year ending on the 31st day of December 2012, the Federal Government budgeted the sum of N1.52 trillion naira for capital expenditure, which is about N50 billion less than the debt owed by the oil companies according to NEITI’s figures.

That’s the way we roll.

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