NEITI Stresses Accountability and Transparency as Cornerstones of Investment in Nigeria’s Energy Sector
Lagos, Nigeria – In a robust call to action, Dr. Orji Ogbonnaya Orji, Executive Secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI), delivered a crucial message at the 2024 Annual Strategic International Conference of the Association of Energy Correspondents of Nigeria (NAEC) in Lagos. The message, aimed at stakeholders in Nigeria’s energy sector, underlined the fundamental importance of accountability and transparency in attracting and sustaining investment in the nation’s vast energy resources.
Represented by Mr. Taiwo Olasupo, the South West Zonal Representative on NEITI’s board, Dr. Orji emphasized that investors demand environments characterized by transparency, where corruption is actively addressed, and the rules of engagement are clear. He pointed out that without these assurances, serious investors would be reluctant to commit capital to the sector.
“Transparency and accountability are not just buzzwords. They are the pillars upon which sustainable investment, economic stability, and social equity are built. Investors seek certainty—they need to know that their capital is protected and will be utilized in a transparent, predictable, and well-governed environment,” Dr. Orji stated.
NEITI’s Role in Securing Nigeria’s Economic Future
According to the NEITI boss, NEITI plays an essential role in ensuring that Nigeria’s oil, gas, and solid mineral sectors operate in an open manner, where revenues are transparently collected and managed for the benefit of all Nigerians. This is achieved through NEITI’s regular audits and industry reports, which provide detailed insights into the sector’s operations.
Dr. Orji announced the release of the 2022/2023 NEITI Oil and Gas Industry Reports, highlighting key insights from the audits that reveal both challenges and opportunities within the sector.
Key Findings from the 2022/2023 NEITI Reports
Among the most significant revelations from NEITI’s latest reports is the outstanding collectible revenue due to the Federal Government, which as of June 2024, amounted to over $6.071 billion and ₦66.4 billion. This figure includes unpaid royalties and gas flare penalties owed to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and outstanding petroleum profit taxes, company income taxes, and other levies due to the Federal Inland Revenue Service (FIRS).
The report also delves into fuel importation and subsidy claims, noting that in 2022 alone, 23.54 billion liters of Premium Motor Spirit (PMS) were imported into Nigeria. A significant reduction in fuel imports was observed in 2023, owing to the removal of subsidies, a move that saved the government from the N15.87 trillion historically spent on price differentials since 2006.
Reduction in Oil Theft and Losses
A key highlight of the 2023 report is the notable reduction in oil theft and losses. In 2023, only 7.68 million barrels of oil were stolen or lost, a staggering 79% decrease from the 36.69 million barrels lost in 2022. This reflects a tightening of controls and a marked improvement in security, providing further confidence for potential investors.
Revenues on the Rise Despite Challenges
Despite the challenges facing Nigeria’s energy sector, the country continues to generate significant revenues from oil and gas. In 2023, revenues hit $21.415 billion, up from $15.549 billion in 2022, with taxes, royalties, and gas flare penalties contributing to this impressive figure.
The Media’s Role in Shaping Transparency
Dr. Orji did not fail to acknowledge the essential role that civil society, especially the media, plays in the fight for good governance in the extractive industries. Journalists, according to the NEITI boss, are natural allies in amplifying the findings of NEITI’s reports and holding stakeholders accountable.
“The media are our natural partners. By bringing NEITI’s reports to the public domain, journalists ensure that transparency in Nigeria’s energy sector remains a topic of debate and action,” Dr. Orji said.
He urged the media to continue playing their watchdog role, emphasizing that transparency and accountability are critical for restoring public and investor confidence in Nigeria’s energy sector.
Looking Ahead
NEITI remains committed to working with all stakeholders to ensure that the Nigerian energy sector is governed transparently and that revenues from the sector are used to benefit all Nigerians. As Nigeria continues to push for reforms in its oil, gas, and solid mineral sectors, the role of NEITI in ensuring transparency and accountability will be indispensable.
Source: NAEC
