Oil. Picture: REUTERS
Oil. Picture: REUTERS

Abuja — An agency tasked with cleaning up Nigeria’s murky oil industry says even though financial accountability has improved, the state oil company still has not explained billions of dollars of missing revenue.

While energy producers had co-operated and complied with requirements to publish payments, the Nigeria Extractive Industries Transparency Initiative (Neiti) had struggled with the state-owned Nigerian National Petroleum Corporation (NNPC), Neiti executive secretary Waziri Adio said last week in an interview in Abuja.

The state oil company had not explained what it did with at least $22.7bn earned from the sale of oil licences and in dividends from its stake in Nigeria LNG over a 15-year period, he said.

"The sector is no longer the black hole it once was, but we can still use more transparency," Adio said. "Things are opening up. There could be more in the areas of contracts, ownership and expenditure transparency, but definitely there is some progress."

NNPC spokesperson Ndu Ughamadu did not answer three calls on his cellphone and two text messages seeking comment. The company said in the past it had the authority of the government in its actions.

Royal Dutch Shell, ExxonMobil, Chevron, Total and Eni operate joint ventures with the state oil company that account for about 90% of the output of Nigeria, Africa’s top producer.

Neiti was set up in 2004 after Nigeria acceded to the Extractive Industries Transparency Initiative, which requires international energy companies and governments involved in mining to publish all their payments.

Annual audits

Nigeria LNG is owned 49% by NNPC, 25.6% by Shell, 15% by Total and 10.4% by Eni.

President Muhammadu Buhari, who pledged during his 2015 election campaign to fight widespread graft in the oil and gas industry, appointed Adio in February 2016 to head Neiti.

For all its work in auditing oil industry payments, critics said the agency remained toothless, lacking the power to compel companies to disclose payments or penalise erring producers. But Neiti’s annual audits had helped the government recover billions of dollars that would have been lost, Adio said.

The Neiti law "does not give us the power to compel compliance or to enforce our recommendations", he said. "But we have done our reports, with findings and recommendations, and we have shared them with the government."

So far the agency has produced reports covering the years from 1999 to 2015 and is working on those for 2016 and 2017, scheduled for public presentation in July and November.

Bloomberg

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