By Chioma Obinagwam
Following analysis of the audit report of the oil and gas industry for 2016 released last December 2019, Budgit has called on oil and gas regulators to step up their oversight responsibility in the industry.
BudgIT, a civic organization that applies technology to intersect citizen engagement with institutional improvement, to facilitate societal change revealed to Confiance News in a statement recently.
“Consequently, BudgIT has critically assessed the report and come up with salient analysis, demanding actions from regulatory bodies in the sector,” BudgIT disclosed in the statement.
From the report which was by the Nigeria Extractive Industries Transparency Initiative (NEITI), 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.
BudgIT stated that going by its analysis, the 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 statement also indicated 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. An under-remittance of N4.02 million was also observed in 2015 due to similar practices.
The civic organisation also found that losses arising from crude oil theft and sabotage in the upstream and downstream sectors amounted to $869.02 million and $3.55 billioqn respectively. Similarly, in 2016, 23 companies incurred a liability of $3.63 million on gas flare penalty.
“This can actually be expended on four research qand development projects in the oil and gas sector,” BudgIT highlighted.
Worried by the spate of loss, BudgIT calls 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,” it lamented.
“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. If properly structured back into the economy, the huge amount that goes down the drain, courtesy of these issues, will go a long way in contributing to the economic recovery and growth plan of the federal government.
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