Oil And Gas Companies Owe Nigeria $6.071Billion, N66.4Billion In Royalties, Gas Flare Penalties
In another development, companies in the oil and gas sector owe outstanding petroleum profit taxes, company income taxes, withholding taxes, and VAT to the Federal Inland Revenue Service (FIRS).
A new report by the Nigeria Extractive Industries Transparency Initiative (NEITI) has shown that the oil and gas industry owes $6.071bn and ₦66.4bn in unpaid royalties and gas flare penalties to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) as of August 31, 2024.
In another development, companies in the oil and gas sector owe outstanding petroleum profit taxes, company income taxes, withholding taxes, and VAT to the Federal Inland Revenue Service (FIRS).
The amounts owed in this regard are $21.926 million and ₦492.8m as of June 2024.
The report by NEITI also revealed a 9 per cent drop in industry revenue in 2023, with $16.467bn recorded compared to $18.106bn in 2022.
Checks by SaharaReporters show that the NUPRC law puts a daily fine of $500 or its naira equivalent each day a company fails to provide accurate data on vent gas or flaring. The company will also pay $10,000 on the first day of its failure to provide data on flaring.
The NUPRC law on flaring reads, “Where an average monthly production of 5,000 barrels or more of oil is produced per day in any Oil Mining Lease area, Petroleum Mining Lease area or Petroleum Prospective Licence area, the Producer or the Licensee shall be liable to the Federal Government for a Flaring penalty expenditure of $2.00 (two United States Dollar) per 28.317 standard cubic metres (one thousand standard cubic feet) of gas flared and vented within such Oil Mining Lease area, Petroleum Mining Lease area or Petroleum Prospective Licence area, irrespective of whether the flaring is Routine or Non–Routine Flaring, provided that, there shall be no liability for the payment where the flaring and venting was caused by an act of war, community.”
The World Bank notes that gas flaring causes significant damage to human health. It also listed Nigeria as the largest emitter of gas on the African continent. Some of the health dangers include respiratory issues, cough, infant mortality and under-weight.
