Energy  

Sector reforms: Hope rises on Nigeria’s new EITI validation

Oil Wells PHOTO: www.theheraldng.com

Oil Wells PHOTO: www.theheraldng.com

THE recent actions of the President Muhammadu Buhari to tackle corruption in the oil and gas industry in particular and other sectors of the economy may post a positive outlook for the nation in scaling the hurdles of getting validated its Extractive Industries Transparency Initiative (EITI) membership again come January 2016.

Indeed, the Nigerian Extractive Industries Transparency Initiative (NEITI) expects that the full implementation of the Audit Reports and recovery of the $11.6 billion unremitted funds and the $7 billion owned by oil companies would better aid the re-validation quest for Nigeria.

NEITI is an agency mandated by law to promote transparency and accountability in the management of Nigeria’s oil, gas and mining revenues.

Having signed up to the EITI framework in 2003 under former president, Olusegun Obasanjo, and subsequently began its implementation in 2004, Nigeria was the first country out of its 46 member nations to enact a specific law, the NEITI Act of 2007 in support of the process. Nigeria attained a complaint nation status in 2013 and will in January 2016 face another round of validation.

The EITI validation exercise is conducted on compliant countries every three years by the global body as a quality assurance mechanism to ascertain the continued level of compliance of member countries to its principles.

Government’s political will and commitment to the EITI process, respect to openness and accountability in the management of oil, gas and mining revenues for the benefit of the citizens are also assessed by the validators.

Raising optimism that the Federal Government would strengthen the agency through implementation of its audit reports, NEITI had appreciated the President’s directive on the NNPC restructuring; the single accounts for MDAs; the setting up a Presidential Committee on Anti-Corruption and the Adhoc Committee of the National Economic Council.

The Director, Communications, NEITI, Orji Ogbonnaya Orji, in a statement recently said: “We are therefore delighted that the much needed political-will required to boldly implement the NEITI recommended reforms is now provided, available and accessible under the leadership of President Muhamadu Buhari,”

Also, applauding the appointment of the new Group Managing Director, NNPC, Dr. Ibe Kachikwu, NEITI, said: “It is our considered hope that new NNPC boss and his new team will consider it a priority to carefully study the findings and recommendations outlined in NEITI independent Reports of the sector. This is with a view to implementing the pending remedial issues under a plan already developed by NEITI and the Inter Ministerial Task Team (IMTT),”

The industry watchdog however recommended some area of concerns for the new team to tackle, such as: the issue of inadequate metering infrastructure for accurate measurement of crude; the onerous JV cash call regime; inefficient cost determination; urgent resolution and review of pricing issues related to expired MoUs and legal agreements with oil companies that have huge revenue loss implications for the nation.

Others are huge costs of fuel subsidy, crude oil swap and products exchange agreements, repair of the refineries, oil theft, review of existing fiscal regime in the industry, automation of record keeping, and the politics of acquisition and assignments of oil blocks by discretion among others.

He said, both the EITI and NEITI stand firmly with Nigerian citizens that revenues from oil, gas and mining should support national development and reduce poverty in our country.



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