The Federal Government of Nigeria received N3.211 trillion as Petroleum Profits Tax (PPT) and Royalties from the third quarter of 2015 to third quarter of 2017, according to the Economic Report of the Central Bank of Nigeria (CBN).
Breakdown of the revenue to the government showed that the country received N495.39 billion as PPT/royalties in third quarter of 2015; N388.66 billion, in fourth quarter of 2015; and N314.04 billion during first quarter of 2016.The revenue from PPT/royalties declined in second quarter of 2016 to N212.78 billion; later increased to N392.38 billion in third quarter of 2016; and decreased to N273.13 billion in fourth quarters of 2016.
There was a rebound of revenue to N325.38 billion in first quarter of 2017; N320.49 billion in second quarter and N489.41 billion during the third quarter of 2017. The CBN report for the third quarter of 2017 released recently, revealed that N103.46 billion was allocated to the 13 per cent Derivation Fund for distribution among the oil producing states.
analysing the report, CBN disclosed that oil receipt at N1.27 trillion during the quarter under review was lower than the proportionate quarterly budget estimate by 6.2 per cent, but was above the receipts in the preceding quarter by 59.7 per cent. According to the CBN, the decline in oil revenue relative to the proportionate quarterly budget estimate was due to the shortfall in receipts from crude oil/gas exports, owing to the decline in crude oil production, arising from leakages and shut-ins/shut-downs at some NNPC terminals.
It disclosed that Nigeria’s crude oil production, including condensates and natural gas liquids, averaged 1.83 million barrels per day (mbd) or 168.36 million barrels (mb) in the review quarter.This, it noted, represented an increase of 0.17 mbd or 10.2 per cent, compared with 1.66 mbd or 151.06 mb recorded in the preceding quarter. The development was due to sustained peace in the oil production region.CBN said that crude oil export stood at 1.38 mbd or 126.96 mb, representing 14.0 per cent increase over 1.21 mbd or 110.11 mb in the preceding quarter.
The development, it hinted, was due, mainly, to reduced activities of vandals in the Niger Delta region.Allocation of crude oil for domestic consumption was maintained at 0.45 mbd or 41.40 million barrels in the review quarter.
Nigerian National Petroleum Corporation (NNPC) Chief Operating Officer, Upstream, Malam Bello Rabiu, proposed some key amendments to the Deep Offshore and Inland Basin Production Sharing Contract (PSC) Act to enable the Federal Government optimize the collection of royalties and other revenue in deep water oil production activities.He noted that it was imperative to effect increment in royalties across all categories to increase government take.
“It is our opinion that the proposal to increase the royalty rate for terrains beyond 1000 metres, from zero per cent to three per cent, is commendable but it is necessary to also make corresponding adjustments in other categories,’’ he said.He argued that in the alternative, the graduated royalty scale as provided in the Act should be removed while the Minister of Petroleum Resources should be empowered to intermittently set royalties payable for acreages located in deep offshore and inland basin production sharing contracts through regulations based on established economic parameters.
“It is our opinion that these incentives have outlived their usefulness and are now impediments to the Federal Government’s revenue collection efforts. The use of such incentives can be terminated by an amendment of section 4 of the Act,’’ the Corporation noted.He called on the National Assembly to seek relevant input from the Federal Inland Revenue Service, to resolve the divergent opinions regarding the methodology for the computation of the taxes which would arise as a result of the proposed royalty regime.
Source: The Guardian
The proposed Nigerian Liquefied Natural Gas, NLNG trains seven and eight would reduce gas flaring in Nigeria to a zero level.
The General Manager, External Relations of the company, Dr. Kudo Eresia-Eke disclosed in Lagos that the completion and operations of trains one to six have reduced gas flaring from over 60 per cent to about 20 per cent in the nation.
According to him, the nation needs more investments in LNG to further reduce gas flaring while harnessing gas for domestic utilisation and export. He indicated that it was unpatriotic for the House of Representatives to amend the NLNG Act, put in place to protect the company from undue distractions.
Eresia-Eke said that the Nigerian Liquefied Natural Gas Limited has taken the battle of the Senate of the Federal Republic of Nigeria in order to reverse the recent amendment of the NLNG Act by the House of Representatives.
The move which is being supported by the shareholders of the company such as the Nigerian National Petroleum Corporation, Shell Petroleum Development Company Limited, Total Exploration and Producing Company and Agip is based on the need to remove hurddles, capable of hindering the implementation of the nation’s $25 billion trains seven and eight project.
The General Manager, External Relations Division of NLNG limited, Dr. Kudo Eresia-Eke, indicated in a telephone interview yesterday that the management of the company has concluded plans to meet the senators this week. He said the company has also scheduled to meet with relevant persons and institutions in the executive arm of government to let them understand why the present amendment should be stopped.
“We have lined up series of events to engage with the Senators because they have a lot to do with this Act. We will also meet with many key persons in the President Mohammadu Buhari-led administration to let them know the issues and implications.”
We are not going to stop there. Plans have also been concluded to keep the general public well-informed because the present development may be partly based on inadequate knowledge, “he added.
Investigations showed that the National Petroleum Investment Management Services (a subsidiary of the Nigerian National Petroleum Corporation), Shell, Total and Agip would continue to work on the $25 billion Liquefied Natural Gas trains seven and eight project despite the recent amended of the NLNG Act.
- Vanguard Nigeria