The Nigerian government’s revenue generation is at risk, as oil and gas companies owe significant debts, according to a recent report by the Nigeria Extractive Industries Transparency Initiative (NEITI). The report, titled the “2022/2023 Independent Oil and Gas Industry Report,” revealed that, as of June 2024, oil companies operating in Nigeria owe the federal government $6.071 billion and ₦66.4 billion in unpaid royalties and penalties.
NEITI’s Executive Secretary, Dr. Orji Ogbonnaya Orji, emphasized the need for greater compliance with regulations and increased transparency within the industry. The report also highlighted a reduction in petroleum imports, from 23.54 billion liters in 2022 to 20.28 billion liters in 2023, and noted a significant decline in crude oil production from 556.130 million barrels in 2021 to 490.945 million barrels in 2022. However, production slightly improved in 2023, rising to 537.571 million barrels.
The report identified additional financial liabilities, including outstanding Petroleum Profit Taxes (PPT), Company Income Taxes (CIT), and Value Added Taxes (VAT) amounting to $21.9 million and ₦492.8 million, owed to the Federal Inland Revenue Service (FIRS).
NEITI also reported a substantial drop in oil theft, with only 7.68 million barrels lost in 2023, compared to 36.69 million barrels in 2022, representing a 79% decrease. Revenue from oil and gas operations was largely generated by material companies, which contributed $15.549 billion (96%) in 2022, rising to $21.415 billion (95%) in 2023.
