Nigeria may lose $23bn to crude oil theft amidst uncertainty of 1.69mbpd 2023 target — Gbajabiamila
The Speaker of the House of Representatives, Hon Femi Gbajabiamila on Tuesday expressed grave concern over the report indicating that Nigeria may lose over $23 billion this year to crude oil theft.
Hon Gbajabiamila stated this in Abuja while declaring open the investigative hearing held at the instance of the Ad-hoc Committee investigating the alleged loss of over $2.4 billion revenue from the illegal sale of 48 million barrels of crude oil export in 2915 including crude oil export from 2014 till date, chairs by Hon. Mark Gbillah.
While assuring that the investigative hearing is not a witch hunt, he averred that the exercise is a constitutional responsibility and also within the Legislative powers of the House as enshrined in sections 88 and 89 of the 1999 Constitution (as amended), Section 2 of the Legislative Houses (Powers and Privileges) Act, 2017 and the Standing Orders of the House of Representatives.
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He said: “The Oil and Gas sector (particularly crude oil) is still the mainstay of Nigeria’s economy accounting for 95% of the country’s foreign exchange earnings and 80% annual of budgeted revenue. While Crude Oil daily production was put at 1.88 million barrels in the year 2022, this figure was never met with production dropping below 1 million barrels during the year with significant revenue losses to the country. 1.69 million barrels in the year 2023.
“Nigeria’s revenue to GDP ratio is below 5% which is rated amongst the five lowest countries in the world and it is reported that about 700 million dollar worth of Crude Oil is lost to oil theft monthly in Nigeria. In January and July 2022 alone, Nigeria lost 10 billion dollars to the crime.
“Available data shows that the country may lose 23 billion dollars this year to Crude Oil theft with concerns being expressed about the possibility of meeting the 2023 proposed production target of 1.69 million barrels per day due to the myriad of issues militating against the attainment of this target, such vandalism, in-accurate reconciliation, insecurity and unreasonable operational cost.
“In the light of dwindling revenue accruing to Nigeria from crude oil sales, it was quite alarming to learn about whistleblower allegations that over $2.4 billion in possible revenue by the country was lost from the sale of 48 million barrels of Nigeria’s crude oil cargoes in China.
“While it is imperative to highlight that these are unverified allegations, the onus is on the House of Representatives as a responsible House of the Nigerian people to carry out a thorough investigation to ascertain the veracity or otherwise of these allegations including an investigation into crude oil exports from Nigeria from 2014-2022 to ascertain the accuracy of recorded revenue from sales during this period, the utilization of this revenue and identify any likely additional losses in revenue to the country.
“This exercise is not a witch hunt but rather a constitutional responsibility and also within the legislative powers of the House as enshrined in sections 88 and 89 of the 1999 Constitution of the Federal Republic of Nigeria, (as amended), Section 2 of the Legislative Houses (Powers and Privileges) Act, 2017 and the Standing Orders of the House of Representatives.
“Corruption continues to be the bane of Nigeria’s development with Nigeria ranking 150th out of 180 countries in the most recent Transparency International’s Corruption Perceptions Index (CPI).
“While the government through its antigraft agencies continues the onerous fight against corruption, the task remains daunting and requires the cooperation of all Nigerians to curb and eventually eradicate.
“It is the practice globally for individuals with information about the existence of proceeds from illegal or corrupt actions by government officials or private individuals to volunteer such information and receive compensation when recoveries are made as an incentive to others.
“While it is commendable that this administration introduced a whistleblower policy in 2016 and has confirmed the recovery of significant proceeds of corruption from its implementation, the policy is without statutory backing and the receipt and expenditure of these proceeds does appear to conform with constitutional provisions and the payment of compensation does not appear to be transparent.
“The recommendation of the Committee after its investigation will no doubt, guide the House in making an informed decision in considering the Whistle-Blower Bill currently before it.
“The legislation when passed into law will address a mirage of issues associated with the implementation of the policy as well as take adequate care of the Whistle-Blowers involved, which is very significant in the success of the policy and law when passed.
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“Let me state emphatically, that whistle-blowers that volunteered information to this Honourable House will receive the maximum legislative protection and confidentiality,” Hon. Gbajabiamila assured.
In his remarks, the Ad-hoc Committee Chairman, Hon. Mark Gbillah disclosed that the Ad-hoc Committee is looking at allegations on the alleged 48 million crude oil barrels sold in China, Crude oil export in general from Nigeria for the period under review, whistleblower revelations and recoveries which the Federal Government publicly declared that they have made recoveries.
“It’s unfortunate that the Minister of Finance is not here, the Attorney General of the Federation is not here.
“This is a formal request from the Committee that they should appear before this committee because they have received a formal invitation to do so. And a lot of what we have to investigate regards to whistleblower policy is saddled within the Ministry of Finance and the Attorney General of the Federation.
“There are responses received from the Accountant General office which show that the Minister of Finance has been approving payments to whistleblowers in percentages at variance with the policy says they should be paid.
“There have been allegations of the Attorney General being involved also in the receiving of funds from outside the country without these funds being remitted into the Federation account in line with the provisions of the Constitution.
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“There have been allegations that there has been the expenditure of these recoveries has also been done in complete violation of the provisions of the Constitution.
“The CBN made a formal response to this Committee indicating that the TSA policy of this administration agencies operates their Treasury Single Account, and make expenditures from these accounts without recourse to the CBN.
“This is something that’s alarming for the CBN to declare before us because we are aware of constitutional provisions that state all revenue accruing to the Federation must be paid into the Federation Account.
“So if there are recoveries being made from whistleblowers, these monies need to be paid into the account of the Federation as required by law.
“So, we are inviting the Minister of Finance, the Attorney General of the Federation, the Secretary to the Government of the Federation and stakeholders involved in the implementation of the whistleblower policy to appear before the Committee to provide clarification on the operation of this policy and the approvals being made by the Finance Minister.
“In regards to the issue of crude oil, we are expecting the Nigerian Upstream Regulatory Commission, NEITI, oil and gas companies who operate fuels and engage in export.
“The Office of the Accountant General of the Federation and the Accountant General himself to be present including the Budget Office of the Federation to be present and provide clarification.
“There are certain individuals as well we need to investigate, certain whistleblower revelation shows that from the Paris Fund refund, hundreds of millions of dollars were paid into companies’ accounts without any record of services provided to the country and these are things that need to be investigated,” Hon. Gbillah stressed.
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