The NEITI FAAC Quarterly Review, released by NEITI on Tuesday in Abuja showed that the disbursements represented a historic high in revenue distribution and a 43 per cent increase, compared to previous years.

It attributed the surge in revenue disbursements to Federal Government’s sustained fiscal reform policies, especially the fuel subsidies removal and foreign adjustment exchange rate policies, which had continued to impact positively on oil revenue remittances.

Announcing the report, Dr Orji Ogbonnaya Orji, the Executive Secretary, NEITI, said the analysis were conducted against the backdrop of major fiscal reforms that reshaped the revenue landscape, particularly subsidy removal impacts on national and subnational finances.

“The report’s objective is to assess the sustainability of the federal and state governments’ borrowing to fund their projects and programmes, as well as the implications of natural resource dependence, particularly for states benefitting from the 13 per cent derivation revenue from oil, gas, and solid minerals.

“The analysis focused on crude oil revenue derivation states, as solid minerals continue to underperform despite their significant potential,” he said.

Orji said the federal received N4.95 trillion, state governments, N5.81 trillion, and local governments N3.77 trillion during the period.

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According to him, the total FAAC disbursements (including Derivation Revenue) is N15.26 trillion.

“The NEITI FAAC Quarterly Review showed that distribution to state governments in 2024 recorded the largest percentage increase of 62 per cent from N3.58 trillion in 2023, followed by local government councils with a 47 per cent increase.

“The Federal Government’s share rose by 24 per cent from N3.99 trillion in 2023 to N4.95 trillion in 2024.

“The report highlights that total FAAC allocations increased by 66.2 per cent from N9.18 trillion in 2022 to N10.9 trillion in 2023 and N15.26 trillion in 2024, with the most significant growth occurring between 2023 and 2024,” he said.

He said NEITI would continue to support the reforms with credible information and data.

Orji said the review called for adequate measures to manage and mitigate economic and other social risks associated reforms in transitional economies like Nigeria.

He outlined such risks to include, inflationary pressure, possible rise in debt servicing costs and fiscal uncertainties for states dependent on oil revenues.

He recommended that governments at all levels should take innovative actions to mitigate the impact of the economic challenges.

“The report also revealed that Lagos State received the highest allocation of N531.1 billion in 2024, followed by Delta (N450.4 billion) and Rivers (N349.9 billion).

“Conversely, Nasarawa State received the least allocation of N108.3 billion, followed by Ebonyi (N110 billion) and Ekiti (N111.9 billion).

“Furthermore, six states—Lagos, Rivers, Bayelsa, Akwa Ibom, Delta, and Kano—each received over N200 billion, collectively accounting for 33 per cent of total allocations to all states.

“While the six lowest-receiving states—Yobe, Gombe, Kwara, Ekiti, Ebonyi, and Nasarawa—accounted for only 11.5 per cent.

“The report revealed a major financial divide, with Lagos, Delta, Rivers, and Akwa Ibom—collectively receiving N1.49 trillion, over three times more than the combined total of the bottom four states—Kwara, Ekiti, Ebonyi, and Nasarawa—which received N442.4 billion.

“The review highlighted that total debt deductions for states’ foreign debts and other contractual obligations amounted to N800 billion, representing 12.3 per cent of total allocations to the 36 states, including derivation revenue,” he said.

He said Lagos State recorded the highest debt deduction of N164.7 billion, accounting for over 20 per cent of total deductions.

He said Kaduna State followed with N51.2 billion, while Rivers (N38.6 billion) and Bauchi (N37.2 billion) also recorded significant debt deductions.

He urged the government to sustain policy reform measures to encourage sustainable revenue growth and economic stability with priority attention focussed on job creation, poverty reduction and control of inflation on goods and services.

The NEITI FAAC Review reiterated the need for stakeholders to leverage the findings and data provided to hold all levels of government accountable for  effective management of public resources, especially revenues from the extractive industries.

Source: NAN

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Mr Ogbonnaya Orji, the Executive Secretary of the Nigeria Extractive Industries Transparency Initiative, NEITI, stated this on Monday in Abuja.

He spoke at the 2025 budget defence session organised by the House of Representatives Committee on Petroleum Resources (Upstream).

Orji revealed that NEITI was collaborating with the Economic and Financial Crimes Commission, EFCC, to recover the funds into government coffers.

The executive secretary noted that, according to the 2020 and 2021 reports, over $3.7 billion was recovered into government coffers as outstanding liabilities from companies operating in the sector.

He explained that NEITI was established to promote transparency and accountability in the Nigerian oil and gas, as well as the mining sector.

Orji said the agency had been allocated a budget of N6.5 billion for the 2025 financial year, comprising N2.220 billion for personnel, N1.722 billion for overhead, and N2.575 billion for capital projects.

Orji outlined some of the critical activities to be undertaken in the year.

They include conducting industry reports on the oil, gas, and mining sector, as well as fiscal allocation and statutory disbursement audits.

He added that research studies would be conducted on the actual volume of PMS consumed in Nigeria.

According to him, it will also indicate the economic impact of energy transition, and a national perception survey of EITI implementation in Nigeria.

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During the budget defence session, Rep. Kafilat Ogbara (APC-Lagos) emphasised the need for government agencies to ensure that their budget proposals complied with the specified line items.

She expressed concern over the N32 million allocated for meals in the 2025 budget, stating that it was excessive, especially during a time of economic hardship.

“Most of our agencies should ensure that what they are bringing as budget proposal must actually tally with the line item and the purpose why you want to use such funds.

“Let us not just see budget defence as, ‘the money is there and we should share it. So, let us see how to get our own share,’” she said.

Rep. Ademorin Kuye (APC-Lagos) also stressed the importance of considering the economic situation in the country when preparing the annual budget.

He noted that the public perceived the National Assembly as a rubber stamp that approved anything presented by government agencies.

The chairman of the committee, Rep. Alhassan Doguwa, faulted the language used in the budget preparation.

He also faulted the inclusion of the National Assembly as beneficiaries of the agency’s welfare package.

Doguwa emphasised that the committee’s primary concern was the welfare of the Nigerian people.

He said the agencies must be mindful of their expenditure of public resources.

“While I agree that the budget stops at our desk and you are just presenting a proposal, I will like to say that the economy is actually bad.

“The population of people for whom we are actually here are crying out. Agencies of government must be mindful of what they spend out of public resources on.

“All these proposals are going to be spent at the expense of the Nigerian people.

“Sometimes, we come to make presentations here that sounds funny and very insultive in the eyes of the people.

“Especially, when you say in your projection things like welfare package in form of ex-gratia, health insurance, welfare packages to staff and some critical stakeholders,” he said.

Doguwa, however, assured the committee’s readiness to support the agency in actualising its mandate.

“Your agency is a critical one and the legislature is appreciative of the work that you are doing,” he said.

Source: NAN

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This was disclosed by EITI’s Deputy Executive Director, Mr. Bady Baldé, during a visit by an EITI delegation to the Group Chief Executive Officer of the NNPC Ltd, Mr Mele Kyari, in Abuja on Thursday.

Baldé who said the delegation’s visit was to communicate the group’s findings in its recent global assessment to the company said NNPC Ltd. fared very well among companies in the same category, adding that only Equinox of Norway fared better than NNPC Ltd. in the assessment.

He, however, said there was still room for NNPC Ltd to improve, stressing that compliance with global EITI standards would help boost the company’s credibility.

The EITI boss also urged NNPC Ltd to remain engaged to play an active role in its Nigerian unit, the Nigeria Extractive Industries Transparency Initiative, NEITI.

Earlier in his welcome remarks, Kyari highlighted some of the key changes in the operations of the NNPC Ltd since its transformation into a commercially focused limited liability company in 2021.

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He acknowledged that the NNPC Ltd.’s partnership with EITI/NEITI had made it a much more reliable company.

He, however, expressed disappointment with NEITI for going public with its report that NNPC Ltd failed to remit some monies into the Federation Account instead of seeking clarification on any perceived gap in its assessment.

He explained that NNPC Ltd was holding no public funds back and that what NEITI reported as non-remittance was what was due to the company as payment for taking the burden of fuel subsidy on behalf of the federal government.

He disclosed that NNPC Ltd would have released its Audited Financial Statement, AFS, for 2022 since June 2023 but could not do so because it had no substantive Board of Directors at that time, adding that the AFS would be published on the company’s website in the next few days.

On his part, the Executive Secretary of NEITI, Dr. Orji Ogbonnaya Orji, called for the reconstitution of the NNPC/NEITI Joint Committee on Reconciliation, stressing that the committee could help in straightening out any grey areas.

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This declaration is coming on the heels of calls by a non-governmental organisation for a probe of several monies allegedly owed to the federation by the national oil company.

NNPC Ltd, in a statement by its Chief Corporate Communications Officer, Mr. Olufemi Soneye, stated that the the claims by the NGO were baseless, considering the fact that NEITI itself had dismissed many of the allegations in the said 2021 report, following a series of engagements with NNPC Ltd.

NNPC Ltd stated that at the outset of President Bola Ahmed Tinubu’s administration, it was made to sell Premium Motor Spirit, PMS, imported into the country at one third of its value, a development that gave rise to an average of N400bn monthly subsidy bill, which subsequently put a strain on its revenues and finances.

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NNPC Ltd further stated that, “that subsidy bill accumulated to up to N3.736trillion as of May 31st 2023.”

It explained that with respect to gas-to-power debts, the non-payment of NNPCL’s share of upstream joint venture gas supplied to the government-owned plants had led to the accumulation of indebtedness of N174.07 billion by the federation.

Similarly, it added, the receivables due from the federation to NNPC Exploration & Production Limited, NEPL, as of 31st May 2023 amounted to $712million (equivalent to N309.07 billion at N434.08/US$1) for revenues not remitted to NEPL but paid into the federation account.

It said while the federation owed NNPCL the sum of N4.207trillion as net indebtedness, the company was only indebted to the federation in the sum of N2.852 trillion, made up mainly of outstanding Good and Valuable Consideration, GVC, in respect of government upstream divestments, royalties and Petroleum Profit Taxes, PPT.

The statement reads in part: “We would like to also use this opportunity to clarify that over the years, our relationship with NEITI has been very cordial, as seen in August 2020 when we became an EITI supporting company in 2020, joining a group of over 65 extractives companies, state-owned enterprises (SOEs), commodity traders, financial institutions and industry partners committed to observing the EITI’s supporting company expectations.

“Indeed, aside being a signatory to several EITI’s global ethics and standards, NNPC Ltd had on the sidelines of the United Nation’s General Assembly (UNGA) in Washington DC, in September this year, signed up to the United Nations Global Compact on human rights, labour, environment, and anti-corruption, thereby becoming the first state-owned oil company to join the global initiative.

“NNPC Ltd’s book remains open to all our stakeholders as we remain committed to delivering value to Nigerians with integrity and as espoused in our principles of Transparency, Accountability and Performance Excellence (TAPE), the bulwark of the Mele Kyari leadership of the company.”

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NEITI said a total of 2.6 billion dollars remained outstanding in the hands of companies as at March 2022.

Dr Orji Ogbonnaya Orji, Executive Secretary of NEITI, said this on Tuesday in Abuja at its Civil Society Organisations, CSO, and media engagement on Extractive Industries Transparency Initiative, EITI, validation.

The EITI validation, which is conducted every three years is a quality assurance mechanism to ascertain level of compliance and progress in implementing its standards among member countries, including Nigeria.

Orji said NEITI’s financial report led to the recovery of the debt.

“By the time we release 2021 report,  any company owing Nigeria we have no choice than to invite EFCC to take over and handle it as an economic crime,” he said.

He said the recovery was as a result of NEITI’s appearance at the National Assembly to defend its position based on data it provided.

Recently, NEITI released 2019 reports which included list of 77 oil and gas companies that owed the government up to 6.8 billion dollars.

The National Assembly had summoned the organisation to come and defend it by showing how it arrived at that.

According to Orji, as soon as it released the 2020 report to prove that, the companies that wanted their names protected were rushing to the relevant agencies to pay up.

He revealed that from 77 companies, the number decreased to 51 companies and the amount came down to 3.6 billion dollars.

“Which shows that from the point we released that information a lot of money came in. None of them disputed our report, rather they were giving excuses why they did not pay.

“The money include all taxes and VAT being collected by the Federal Inland Revenue Service, FIRS, and all royalties being collected by the Nigeria Upstream Petroleum Regulatory Commission, NUPRC.

“NEITI collects nothing, all we are asking is for us to be recognised and offered thank you,” he said.

He said that through NEITI, there had been increased demand, easy access and availability of verified information and data in the public domain.

He said President Muhammadu Buhari’s administration should take credit on doing well on extractives sector reforms.

“The content of our up to date reports is very incisive and is shaping public debates,” the executive secretary said.

Source: NAN

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The agencies are: the Nigerian National Petroleum Company Ltd., NNPC; Federal Inland Revenue Services, FIRS; Department of Petroleum Resources, DPR, now Nigeria Upstream Petroleum Regulatory Commission, NUPRC, and Ministry of Mines and Steel Development, MMSD.

NEITI said on Thursday that the information and data were contained in the latest Fiscal Allocation and Statutory Disbursement, FASD, report, it recently published covering 2017 to 2019.

The report stated that out of the amount, N22.68 trillion was remitted to the Federation Account.

The NEITI FASD report revealed that FIRS generated the sum of N13.48 trillion within the period under review with Petroleum Profit Tax, PPT, accounting for N5.80 trillion (43.09 per cent).

It added that Value-Added Tax, VAT, and other taxes accounted for 32 per cent and 24 per cent respectively while it recorded highest revenue collection of N5.02 trillion in 2018.

The report said that a total sum of N8.82 trillion was generated by the NNPC within the period.

It said the breakdown showed that N4.55 trillion came from domestic crude sales, while export receipts accounted for N4.27 trillion.

It further disclosed that N5.33 trillion was deducted at source for Joint Venture, JV, cash call and others, leaving the net amount of N3.49 trillion, transferred to the Federation Account.

“During the period under consideration, a total of N8.82 trillion was generated. However, only N3.49 trillion (39.55 per cent) was remitted to the Federation Account due to deductions at source by NNPC for JV cash calls.

“The deductions at source by NNPC negate the principle of Federation Account,” the report said.

From the report, DPR (now NUPRC) generated N3.53 trillion for the three years under review, with royalty payments accounting for N3.40 trillion (96.41 per cent).

It said the agency, however, transferred N3.53 trillion to the Federation Account.

It said the audit established that the surplus of N6.72 billion was as a result of unremitted receipts from prior year.

The report further revealed that the Ministry of Mines and Steel Development, MMSD, generated N12.498 billion within the three years period.

The breakdown showed that Mining Inspectorate Department, MID, contributed N6.43 billion while Mining Cadastral Office, MCO, accounted for N6.06 billion.

The breakdown of the figures also showed that minerals and non-minerals revenue contributed N12.84 trillion (56.61 per cent) and N6.57 trillion (28.97 per cent) respectively, while VAT accounted for N3.27 trillion (14.42 per cent).

According to the report, the audit covers four federal revenue generating and 11 beneficiary agencies that are involved in the management of extractive industries funds.

It said it also covered nine selected states: Akwa-Ibom; Bayelsa; Delta; Gombe; Imo; Kano; Nasarawa; Ondo and Rivers.

It listed the beneficiary agencies as: the Niger Delta Development Commission; Tertiary Education Trust Fund; Petroleum Trust Development Fund; Petroleum Equalisation Funds; Ecological Fund and Stabilisation Funds.

Others are: the Nigerian Sovereign Investment Authority, NSIA; Development of Natural Resources Fund, DNRF; Excess Crude Account, ECA; Nigeria Content Development and Monitoring Board, NCDMB, and Petroleum Products Pricing Regulatory Agency, PPPRA.

On the NDDC, NEITI report revealed that 755.96 billion Naira was generated by the commission within the period under consideration.

The breakdown showed that N551.08 billion (73 per cent) was contributed by oil and gas companies, while the balance of 203.90 billion Naira (27 per cent) was federal government’s contribution to the commission.

The report further revealed that the total expenditure by the commission during the period under review was N882.3 billion.

Analysis of the expenditure showed that N778.29 billion (88.20 per cent) expended on development projects, while operational cost accounted for N104.07 billion (11.80 per cent) of the total.

According to the report, NEITI audit established that there was a gap between actual development projects expenditure as per audited financial statements and project monitoring list provided by the commission in the sum of N522.60 billion.

“While N679 billion was reported in NDDC’s financial statement, the project monitoring list reported expenditure of N157 billion on physical projects among the nine member states,” it said.

The report however, disclosed that 40 oil and gas companies defaulted in their payment obligation to the commission.

It said that the PTDF revenue for the period under review was put at N155.34 billion and 95 per cent came from signature bonus paid by oil and gas companies which was the main revenue source to the agency.

NEITI report revealed that out of N86.34 billion utilised by the agency within the period under review, N59.84 billion was spent on core operating expenses while N26.35 billion and N143 million was for personnel/ administrative expenses and capital respectively.

The report noted that the PTDF extended funding to 125 approved institutions, 43 locals and 82 foreign institutions.

According to the NEITI report there was low expenditure compared with the revenue released during the years under review as only 56 per cent of revenue was utilised.

NEITI report put total receipts by Nigeria Content Development and Monitoring Board, NCDMB, for the three years under review at N126.73 billion.

It noted that one per cent of the NCDMB payment accounted for N116.95 billion (92 per cent) of the revenue.

The federal government stopped funding the agency from its budget in 2017.

According to the report, 48.07 per cent of the revenue was used for operating expenses while 51 per cent was used for capital expenditure.

NEITI report disclosed that PPPRA received a total of N27.68 billion as subventions for the three years period.

It noted that the regime of subsidy payment on petroleum product was discontinued within the period under review.

The publication of FASD report is in fulfilment of the Nigeria’s obligation to the global Extractive Industries Transparency Initiative, EITI, and in compliance with the provisions of the NEITI Act 2007.

Source: NAN

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Mr Boss Mustapha, Secretary to the Government of the Federation, SGF, who performed the inauguration on Thursday in Abuja, congratulated the members, saying their appointment as NEITI board members was based on individual merits and track records.

“Your appointment and inauguration, which is taking place here today is another practical demonstration of President Muhammadu Buhari’s commitment to transparency and accountability in the management of our economic resources.

“And especially, given the mandate and objectives of the Nigeria’s NEITI, ” Mustapha said.

Mustapha said that the present administration was passionate about the NEITI process because it served two key agenda of the administration.

He said that the extractive industry was very strategic to Nigeria’s economy, hence central to the administration’s economic agenda.

According to Mustapha, the transparency and accountability in the management of nation’s resources was equally central to the anti-corruption agenda of Nigeria.

He said it was therefore, irrevocably committed to the implementation of NEITI in the oil, gas, and mining industries.

The SGF, therefore, tasked NEITI board members to ensure that the agency continued to preserve the virtues for the benefit of the present and for future generations of Nigeria.

“In order to achieve this, I must remind you that your assignment is non-partisan because NEITT itself is non-political and has maintained dignified neutrality all through almost two decades of existence.

“It is also necessary for me to stress that your appointment is a part-time one. You are therefore advised to conduct yourselves in accordance with this requirement,” he said.

Responding, Mr Olusegun Adekunle, a retired Permanent Secretary, office of the SGF, thanked President Muhammadu Buhari for considering them worthy for the appointment.

Adekunle assured that the board would not disappoint the president in the course of carrying out its assigned duties.

The retired permanent secretary said his appointment alongside other board members was another opportunity to serve Nigeria in another capacity.

“Let me also congratulate my colleagues on the board for this wonderful opportunity to serve our nation in a different capacity.

“I must say that the confidence reposed in us is huge but our commitment to this assignment is also strong; we shall therefore, work as a team with focus and with integrity, ” Adekunle said.

Members of the board are Bashir Bature Gafai (North-West), Iliya Gashinbaki (North-East), Godwin Akor Ogwuche (North-Central), Nze Joe Ibeh (South-East), Awowo Christian (South-South) and Damilola Olawuyi (South-West).

Other members include the Permanent Secretary, Ministry of Mines and Steel Development; Executive Chairman of the Federal Inland Revenue Service, FIRS; and the Group Managing Director of the Nigeria National Petroleum Corporation, NNPC.

The board also has a representative of the International Oil Companies (IOCs).

The civil society organisations are represented by Peter Egbule, while the presidents of Nigeria Mining & Geosciences Society, NMGS, and Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, are representing extractive industries professional unions on the board.

Source: NAN

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It noted that NNPC was showing to the world that things could be done correctly such that would yield value for Nigerians.

A press release by the Group General Manager, Group Public Affairs Division, Dr. Kennie Obateru, quoted Engr. Izuwah as saying that the novel NNPC virtual public bid-opening exercise was in line with the ICRC infrastructure revolution drive.

“You showed to the world that you’re driving a totally transparent Public Private Partnership process in line with the infrastructure revolution of President Muhammadu Buhari. Today’s public bid opening for the rehabilitation of NNPC pipelines, depots/terminal infrastructure is quite commendable.

“I commend the GMD Mallam Mele Kyari, his team and the NNPC Group for showing to the world that things can be done properly and in the best interest of the shareholders,” Engr. Izuwah stated.

No fewer than seventy eight companies submitted virtual bids to rehabilitate critical downstream pipelines, associated depots and terminal infrastructure of the Nigerian National Petroleum Corporation, NNPC, through the Finance, Build, Operate and Transfer, BOT.

In his opening remarks, the Group Managing Director of the NNPC, Mallam Mele Kyari, stated that the exercise was in fulfilment of NNPC’s avowed commitment to transparency and accountability as an Extractive Industries Transparency Initiative, EITI, partner company and as directed by President Muhammadu Buhari that all its operations must be guided by integrity.

“This is not possible to achieve if we do not have the leadership disposition that is in support of transparency. I can confirm to all of you that it is the clear directive of Mr. President that this company must be accountable and must be transparent to its shareholders. We must take all necessary steps to make sure that our transactions are known to the citizens of this country, that we do things for the common good of all of us and that in doing our business, we must ensure integrity,” the GMD stated.

He posited that as an EITI partner company, NNPC is a global company, completely transparent to its shareholders and stakeholders stressing that the Corporation must always disclose her transactions, contracting processes, selection of its  partners, identities of partners and beneficial owners of the partners.

“Nobody will cut corners, nobody will cheat the shareholders of this company and also this company will ultimately deliver value to its shareholders,” Mallam Kyari stated.

He noted that the Finance, Build, Operate and Transfer, BOT, model became imperative in the Corporation’s journey to rehabilitate its downstream infrastructure which over time have become vulnerable, lost value and integrity due to age and incessant vandalism.

“Some of these assets are as old as forty years (40) years and they are due for replacement and when you want to do a replacement of this scale, you do need a lot of resources. And we know that we require these assets so we decided that we bring in private partners who will fund these pipelines, they will construct it, they will operate it with us and then ultimately they will fully recover their investment from the tariff which we will pay for using these pipelines and as soon as they recover their cost and their margin, they will hand over these assets back to us,” Mallam Kyari informed.

Mallam Kyari averred that by the end of the first quarter of 2021, the final partners of the bid opening would be selected.

He assured the bidders that the NIPEX portal which was deployed for the pre-qualification exercise was a time tested technology that would not give room for any human indiscretion.

Earlier, the Chief Operating Officer, Downstream, Ms Lawrencia Ndupu, who was represented by the Managing Director, Petroleum Products Marketing Company, Musa Lawan, said the Nigerian Pipelines and Storage Company, NPSC, operates 5,120 length of pipelines which traverses the entire country with two coastal depots in Lagos and Calabar assuring that the public bid opening processes is being done transparently.

On her part, the General Manager, Supply Chain Management, SCM, NNPC, Mrs. Sophia Mbakwe, said at the end of the submission of virtual bids, 78 companies submitted bids for the pre-qualification of rehabilitation of NNPC downstream critical pipelines, associated depots and terminal infrastructure.

Other external observers who witnessed the exercise were Bureau of Public Procurement, the Nigeria Extractive Industries Transparency Initiative, NEITI, Civil Liberty Organisation and the Centre for Transparency Watch.

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This was contained in the latest edition of the quarterly report on the review of the Nigeria Extractive Industries Transparency Initiative, NEITI, released in Abuja, on Tuesday.

A breakdown of the disbursements showed that N1.53 trillion went to the Federal Government, while the states got N1.29 trillion and the 774 local government areas received N771.34 billion.

The N1.53 trillion received by the Federal Government in H1 2020 was 4.28 per cent lower than the N1.599 trillion it got in the first half of 2019 and 7.36 per cent lower than the N1.652 trillion it received in the first half of 2018.

“For states, a total of N1.29 trillion was disbursed in the first half of 2020.

“This was 2.8 per cent lower than the N1.35 trillion disbursed in the first half of 2019, and 5.6 per cent lower than the N1.37 trillion disbursed in the first half of 2020,” the report stated in part.

For local government areas, the 2020 first half disbursements were 2.64 and 3.04 per cent lower than the corresponding disbursements for 2019 and 2018, respectively.

However, disbursements in second quarter (Q2) 2020 were 1.09 per cent higher than total disbursements in Q2 2019 and 3.66 per cent lower than the one for Q2 2018.

“FAAC disbursements in the second quarter of 2020 stood at N1.934 trillion.

“This was made up of N739.2 billion to the Federal Government, N629.3 billion to state governments, and N375.4 billion to the 774 local government areas.”

According to the report, the total FAAC disbursements in the second quarter of 2020 was slightly lower than the N1.945 trillion disbursed in the first quarter of 2020.

This aligned with the projections made in the previous issue of the NEITI Quarterly Review, which projected lower FAAC disbursement in the second quarter.

The report attributed the 0.55 per cent decrease in Q2 2020 to a couple of factors, including rebound in oil prices in the second quarter as a result of ease of lockdowns by countries across the world.

The other was the adjustment of the official exchange rate by the CBN from N307 to a dollar to N360 to a dollar in March resulting in higher naira disbursements.

FAAC disbursements in the first quarter and second quarter of 2020 were very volatile, with the difference in total disbursements between months ranging between N58.9 billion and N199.3 billion.

“During this period, the disbursements were very volatile in the first half of 2020, compared to 2018 and 2019.

“Unlike 2018 and 2019 where aggregate disbursements increased and decreased in successive months, in 2020 they fell for two straight months, increased in one month, and then decreased for two straight months.”

In the months under consideration in 2020, aggregate disbursements fluctuated by large amounts, compared to 2018 and 2019.

“Aggregate disbursements were N716.3 billion in January and this fell to N647.4 billion in February.

“Thereafter, disbursements fell to N581.6 billion in March, before increasing to N780.9 billion in April.

“Disbursements then fell to N606.2 billion in May and to N547.3 billion in June.

“These figures indicate differences of N68.9 billion between January and February, N65.7 billion between February and March, N199.3 billion between March and April, N174.7 billion between April and May, and N58.9 billion between May and June.

“For comparison, the highest inter-month difference in the first half of 2018 was N62.9 billion, while the corresponding figure for 2019 was N63.5 billion.

“Thus, there have been very wide fluctuations in aggregate disbursements so far in 2020,” the report also stated in part.

NEITI in the report also disclosed that from January to May 2020, actual government revenue was N1.62 trillion, representing 62 per cent of the expected pro-rata revenue of N2.62 trillion from the revised budget.

This, the NEITI said explained a shortfall of 38 per cent in government revenue for the first five months of the year.

As oil prices continue to rise, and with the increased pace of economic activities, it projected that government revenue will perform better in the second half of 2020, with the possibility of shortfalls in revenue compared to budgeted figures.

On total net FAAC disbursements and deductions for states for the first half of 2020, the report observed wide disparities.

Osun State had the lowest net disbursement of N13.13 billion, while Delta State had the highest net disbursement of N100.81 billion.

“This implies that Delta State received seven times the disbursement that Osun State received.

“Total net disbursements received by Delta State (N100.81 billion) was higher than the combined total net disbursements of N99.47 billion received by six states – Osun, Cross River, Plateau, Ogun, Gombe and Ekiti.

“Also, the combined total net disbursements of N321.29 billion received by the four highest receiving states of Delta, Akwa Ibom, Rivers, and Bayelsa were higher than the combined total net disbursements of N314.08 billion received by 16 states.

“The states are Osun, Cross River, Plateau, Ogun, Gombe, Ekiti, Zamfara, Kwara, Nassarawa, Ebonyi, Taraba, Benue, Adamawa, Ondo, Bauchi, and Abia.

“While Lagos State had the highest deductions, Yobe State had the lowest.”

Source: NAN

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It is joining a group of over 65 extractives companies, state-owned enterprises, SOEs, commodity traders, financial institutions and industry partners who commit to observing the EITI’s supporting company expectations.

According to the Group General Manager, Group Public Affairs Division, NNPC, Dr. Kennie Obateru, the new status would require that NNPC:

• Publicly declare support for the EITI Principles and, by promoting transparency throughout the extractive industries, help public debate and provide opportunities for sustainable development.
• Publicly disclose taxes and payments.
• Ensure comprehensive disclosure of taxes and payments made to all EITI implementing countries.
• Publicly disclose beneficial owners and take steps to identify the beneficial owners of direct business partners, including Joint Ventures and contractors.
• Engage in rigorous procurement processes, including due diligence in respect to partners and vendors.
• Deliver natural resources in a manner that benefits societies and communities.
• Ensure that company processes are appropriate to deliver the data required for high standards of accountability.

EITI Board Chair, Rt Hon. Helen Clark, welcomed the company’s commitment to the EITI: “NNPC plays a vital role in Nigeria’s economy. Joining the EITI as a supporting company is a welcome step in the NNPC’s journey towards achieving greater transparency and to help ensure that Nigeria’s citizens benefit from their natural resource wealth.”

Zainab Ahmed, Nigeria’s Minister of Finance, Budget and National Planning and former EITI Board member, also stressed the importance of ensuring that natural resource wealth contributes to sustainable development, saying that: “Increased transparency of Nigeria’s national oil company revenues is contributing to improvements in our country’s domestic resource mobilisation efforts.”

Established in 1977, NNPC has grown to become the largest asset holder across Nigeria’s oil and gas industry value chain.

Traditionally an oil and gas entity, it is transitioning towards becoming an integrated energy company with an interest in power generation and transmission.

The state-owned company has recently taken measures to become more transparent.

In June 2020, it published audited account for 20 of its subsidiaries.

NNPC also publishes its financial and operations report every month on its website, national dailies and online media to keep the public informed about its activities as part of efforts to be accountable to Nigerians.

It is working with Nigeria EITI (NEITI) on an action plan to routinely disclose information and it currently publishes some of the data required by the 2019 EITI Standard on its website.

These disclosures demonstrate NNPC’s commitment to its journey to become a more transparent national oil company.

Adherence to the EITI supporting company expectations will give further impetus to NNPC’s corporate vision of greater transparency and accountability.

Three areas in which there is scope for advancing transparency are revenues and payments to government, contracts governing petroleum exploration and production and consolidated group-level financial statements.

Mele Kyari, Group Managing Director at NNPC, affirmed his company’s commitment to the EITI: “Becoming an EITI supporting company aligns with NNPC’s corporate vision and principles of transparency, accountability and performance excellence. Our partnership with NEITI and EITI strengthens our commitment towards commodity trading transparency, contract transparency and systematic disclosure of revenues and payments. We are on a journey towards greater transparency and look forward to deepening our collaboration with the EITI to further this work.”

NEITI Executive Secretary, Waziri Adio, commended NNPC’s move to support the EITI: “NNPC joining the EITI as a supporting company is a major inflection point in the quest for transparency – for the company, for Nigeria’s oil and gas sector, and for the country as a whole. This is so given how critical NNPC is to the sector and to the country. NEITI welcomes this bold commitment. We will continue to work and walk with NNPC to translate its espoused commitments to transparency and accountability into concrete and sustained actions and results.”

Becoming an EITI supporting company can help state-owned companies make progress on the journey to transparency.

A recent example is Qatar Petroleum, which has been an EITI supporting company since October 2019 and has now published its annual and sustainability plans for the first time.

EITI’s mission is to promote understanding of natural resource management, strengthen public and corporate governance and provide the data to inform greater transparency and accountability in the extractives sector.

By becoming a member of the EITI, 54 countries have committed to disclose information along the extractive industry value chain – from how extraction rights are awarded, to how revenues make their way through the government and how they benefit the public.

Through participation in the EITI, countries agree to a common set of rules governing what has to be disclosed and when – the EITI Standard.

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