Yemisi Izuora
The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has opposed the proposal of Aliko Dangote that the Nigerian Liquefied Natural Gas (NLNG) and other assets of the Federal Government be put on sale and its proceeds plough back to the economy.
A statement by its Acting Chairman, Shettima Umar Abba Gana, argued that it would not be proper for government to dispose of its crown jewels that generate revenue and keep the Federation Account healthy over the long term.
The statement recalled that when the government sold petroleum marketing companies, the Nigerian National Petroleum Corporation (NNPC) was forced to establish NNPC Retail Ltd, adding that the revenue derived from the sale of some oil blocks by some international oil companies (IOCs) has not been remitted into the Federation Account.
Similarly, the Commission noted that the government sold houses meant for ministers and members of the National Assembly as part of the monetisation policy, adding that the Federal Government might be compelled to build houses for political office holders because of rising cost, rent and security concerns.
Citing the Nigeria Extractive Industry Transparency Initiative (NEITI) 2013 audit and financial report of the oil and gas industry, RMAFC lamented that $12.9 billion was received by NNPC from the NLNG in eight years which the corporation did not remit to the Federation Account. The audit, according to the Commission, also revealed that NLNG paid $1.289 billion as dividends in 2013.
“It is the considered view of the Commission that Nigeria’s assets such as the NLNG and other strategic national resources for that matter should not be sold to meet short-term financial obligation,” RMAFC warned.
Contrary to the advice given by the Central Bank of Nigeria (CBN) Governor, Mr Godwin Emefiele, that the government stood to realise $10 billion from the sale of these assets, the Commission said the same amount could be borrowed from the International Monetary Fund (IMF) and use the revenue from these same assets to repay the loans over the next 20 years after which the government would still retain the assets and continue to enjoy their regular annual dividend payments.
The Commission said instead of selling off such vital assets, which generate considerable funds for the federation, wealthy Nigerians should be encouraged to set up their own LNG projects, since Nigeria ranked seventh in the world and first in Africa with natural gas reserves base totalling 188 trillion cubic feet (Tcf) as at May 1, last year.
In addition, Nigeria’s natural gas is regarded as one of the best in the world as it has low hydrogen sulphide (H2S) or carbon dioxide (Co2) impurity levels, it added.