The Nigeria Extractive Industries Transparency Initiative, NEITI, has revealed that Nigeria has no data at the moment to support its claim on exact quantity of crude oil produced by oil companies.
This is because there are no meters at wellheads of operating assets, said the Executive Secretary of the NETI, Dr. Orji Ogbonnaya Orji.
Orji explained that the absence of the meters and the lack of capacity to monitor deep offshore means Nigeria does not have the exact amount of crude oil produced in the country.
He disclosed this on Thursday during a courtesy visit to the Director General of the Federal Radio Corporation of Nigeria, FRCN, Dr. Mansur Liman in Abuja.
NEITI has in all its oil and gas audit reports recommended that meters be placed on oil wellheads to measure the volume of crude oil produced in the country. He explained that efforts to reform the petroleum industries have not yielded the needed results because those who benefit from the outdated oil law governing the sector have resisted the passage of the Petroleum Industry Bill, PIB.
“The only law that governs the oil and gas industry in Nigeria currently is the Petroleum Act of 1958. And if you use this law in computations of taxes and royalties based on very old rate, Nigeria losses a lot of revenue”, he stated.
He said NEITI has helped in drawing attention to this, noting that the industry has been operated through regulations, guidelines and pronouncements with no new law since 1958. He stressed that Nigeria’s failure to update its laws in the sector means when prices go up, the country is unable to derive maximum benefit from the situation.
He pointed out the International Oil Companies, IOCs do not have interest in updating the laws because it currently favours them.
“We do not have capacity to go deep shores to know how much we are producing. As we speak, it is very difficult for any Nigerian to ascertain how much actually we are producing.
“This is one of the challenges that NEITI is dealing with because if you do not know how much you are producing how would you know how much you are expected to earn. “Because the companies the companies that go deep shore that are involved on offshore exploration none of them are indigenous Nigerian companies and they cannot really protect the interest of the country as much as Nigerians can.
“But we must concede to those companies, they are doing a great job here because without them there will be no oil industry”, he added.