NIETI saved about $ 1 bn for Nigeria in 2004 and 2005

Jan 02, 2007 01:00 AM

The Nigeria Extractive Industries Transparency Initiative (NEITI) has said it saved about $ 1 bn for Nigeria in the oil and gas industry in 2004 and 2005 as a result of the checks it has initiated for the same period.
Speaking in Abuja recently, NEITI Executive Secretary, Dr Bright Okogwu said close monitoring by the NEITI of the oil companies during the period accounted for the huge savings. He also called on the National Assembly to quickly pass the NEITI Bill into law.

According to him, a lot of loopholes and leakages in the oil industry have been blocked adding that, "in 2005, oil companies directly decided to pay up because they know we are watching them. And so, in 2005, close to $ 600 mm was saved. So, we are looking at close to a bn dollars saved within two years. You can actually see the need of getting this bill passed in order to institutionalise what we have started."
Okogwu said NEITI had been able to surpass the minimum international standard with respect to the improvementof transparency in the oil and gas sector.

"We have been able to do this to the extent that Nigeria has now become the country that everybody sees as a flag bearer with regards to the EITI. For instance, the EITI requires companies to publish what they pay; and on the side of government, they should also reveal how much they are receiving so that there is that flow and everybody will be satisfied that there is nobody cheating anybody.”
"But if you think about it, that particular requirement is the barest minimum, so what we decided to do in the case of Nigeria really was to go beyond the standard EITI template by coming up with what we now know as Physical Audit; in other words, we did not just concentrate on the financial audit which is the flows, we also did the fiscal.”

"We also did process audit; how the industry is managed in the case of Nigeria, in the process of awarding licenses, in the process of importing fuel and so on; all these things were examined. So that is why people regard the Nigerian EITI as EITI plus because we had gone far beyond the minimum."
He therefore called on the National Assembly, particularly the Senate, to ensure that the NEITI establishment bill is passed so that the progress and success so far recorded is not reversed. He warned that if the bill was not passed, the nation would not be able to institutionalise the gains of NEITI.

On the issue of discretional allocation of oil blocks, he said the practice had since been jettisoned because of a number of measures taken by government to discourage it.
He blamed the practice of discretional allocation of oil blocks on the 1969 Petroleum Act which empowered the Minister of Petroleum to so allocate blocks, stressing, "what we did to demonstrate the commitment of NEITI towards resolving this matter was that in 2005, for the very first time, the allocation of blocks were done in an open and very transparent manner," he said.

Source: Vanguard
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