Abuja, November 18, 2018. Revenue disbursements by the Federation Account Allocation Committee (FAAC) to the three tiers of government has witnessed a steady increase in three consecutive quarters of this year with N2.28 trillion shared in Q3 of 2018.

A breakdown shows that the Federal government received the highest sum of N904.8 billion, followed by states, which received N718.5 billion and Local governments (LGCs) receiving the lowest disbursements of N432.1 billion.

This information is contained in the latest edition of the NEITI Quarterly Review just published.

From the NEITI Review, “Total FAAC disbursements in the third quarter of 2018 amounted to N2.28 trillion representing a 17.6% increase over the N1.938 trillion disbursed in the first quarter of 2018 and 13.5% higher than the N2.008 trillion disbursed in the second quarter.’’

The NEITI Quarterly Review notes that “It is interesting that with the exception of July, the lowest amount disbursed so far in 2018 is higher than disbursements in all other months in 2016 and 2017”.

A breakdown of the disbursed sums for 2016, 2017 & 2018 shows that the disbursements in the third quarter of 2018 (N2.28 trillion) were 31% & 18% higher than disbursements in the third quarters of the last two years.

NEITI also reports that the last time total disbursements exceeded the N2.5trillion mark was in the second quarter of 2014 (N2.510 trillion).

Further analysis of the increases as reported by the NEITI Quarterly Review shows that the federal government’s receipt of N904.8 billion in the third quarter of 2018, was 11.3% and 7.8% higher than the amounts received in the first (N812.8 billion) and second (N839.5 billion) quarters of 2018 respectively.

“The amount disbursed to states represented an increase of 5.1% over the N683.5 billion disbursed in the first quarter, and an increase of 3.8% over the N692.1 billion disbursed in the second quarter. For LGCs, the amount received was 9.8% and 7.5% higher than the respective amounts of N393.4 billion and N402.1 billion received in the first and second quarters,” the NEITI Quarterly Review disclosed.      

On a year-by-year analysis, NEITI reveals that the increase to third quarter disbursements to states in 2018 were the highest when compared to 2016 and 2017 figures disbursed to other federating units.

A breakdown of the figures showing the level of growth indicates that “Total disbursements to states in the third quarter of 2018 came to N718.5 billion, representing a growth of 40.1% and 22.5% over disbursements in the third quarters of 2016 (N512.7 billion) and 2017 (N586.6 billion) respectively” NEITI observes .

The NEITI Quarterly Review continues, “For the LGCs, disbursements in 2018 Q3 totaled N432.1 billion. This figure was 33.2% higher than the N324.3 billion disbursed in 2016 Q3, and 18.7% higher than the N324.3 billion disbursed in 2017 Q3. Total disbursements to the FGN in the third quarters of 2016, 2017 and 2018 were respectively, N697.9 billion, N752.7 billion, and N904.8 billion indicating that in 2018 Q3, the FGN received 29.7% higher disbursements than 2016 Q3, and 20.2% higher disbursements than 2017 Q3”.      

The review further disclosed that total net FAAC disbursements to states in the first nine months of 2018 ranged between N16.41 and N150.59 billion, with Osun and Delta states receiving the lowest and highest amounts respectively.

A comparison of the state-by-state net disbursement shows a stark disparity in the amounts received. For instance, the net disbursement received by Delta State in January alone sums up to the total net disbursements to Osun State from January to September 2018. This clearly indicates that disbursements to Delta State were higher than the one to Osun by over 800%.

Abuja, November 13, 2018. The solid minerals sector contributed a total sum of N43.22billion to government coffers in 2016, reports the Nigeria Extractive Industries Transparency Initiative (NEITI).

A breakdown of the figure shows that taxes collected by the Federal Inland Revenue Service (FIRS) accounted for N40.38 billion or 93.43%, while fees collected by the Mining Cadastral Office stood at N1.15 billion or 2.66%.

The Mining Inspectorate Department (MID) recorded N1.64 billion as royalty payments, an increase of 30.15% over the N1.27 billion reported as royalty payments in 2015.

These are some of the highlights of the 2016 audit report of the solid minerals sector released today by NEITI.

The audit conducted under the EITI principles and standard reconciled payments made by mining companies in terms of taxes, royalty and rents against receipts of such payments by relevant government agencies.

From the report, total minerals production for 2016 was 41.87 million tons valued at N34.09 billion, representing 33% increase on the N25.56 billion reported in 2015.

However, tax collection and payment of other fees for 2016 reduced by 32% when compared to the figure of N63.98 billion for 2015.

The report further disclosed that while six hundred and fifty-one (651) extractive companies made royalty payments in 2016, only fifty six (56) companies that met the materiality threshold of N3million and above were considered for reconciliation. The companies that met this threshold accounted for 86.87% of the total royalties paid.

On state-by-state minerals production, Ogun State contributed 33.49% to the total production to top the table, followed by Kogi State with a contribution of 19.7%, while FCT came third with 6.20%.

From the report, minerals production by companies shows that three companies - Dangote Cement Plc, West African Portland Cement Plc, and United Cement Company of Nigeria Limited (UNICEM) contributed 70% of total production in 2016. This shows that the cement sub-sector is still dominant in solid minerals production activities.

Further analysis of production by minerals types shows that limestone was the most produced mineral and accounted for 49.35% of the total solid minerals production in 2016, followed by granite with 31.32%. The least contributions were made by gypsum, iron, talc and amethyst with 0.1% each.

The report also revealed that the solid minerals sector’s contribution to exports in 2016 stood at ₦11.16 billion, representing 3.38% of the N330.01 billion for non-oil exports and 0.13% of total export of ₦8.53trillion.

From the report, China was a major destination of Nigeria’s solid minerals in 2016, accounting for 53.63%, followed by Spain and India which accounted for 26.48% and 8.90% respectively.

The report put the Free on Board (FOB) value of the solid minerals exported in 2016 at $40.934 million while the overall contribution of the sector to the country’s GDP was put at ₦87.61billion representing 0.13 % of the total GDP of N67.9 trillion.

The sector has witnessed a steady, even if marginal increase in its contribution to the GDP from 0.11% in 2014, 0.12% in 2015 to 0.13% in 2016. The sector also contributed 0.3% to national employment in 2016.

The report also disclosed that a total of 4,575 valid minerals titles spread across the various states of the federation were recorded in 2016. This comprises 1,751 Exploration Licenses, 208 Mining Leases, 1,563 Quarry Leases, and 1,053 Small Scale Mining Leases.

Out of the total valid titles in the MCO register, 1,465 titles were issued in 2016 while 1,030 were revoked and 14 were transferred. The report further stated that 315 Exploration Licenses were issued in respect of the priority minerals identified by government. The priority minerals are gold, lead-zinc, baryte, iron-ore, bitumen, limestone, and coal.

The report revealed that some title holders entered into MOUs with other companies without duly informing the relevant government agencies. As a result, out of the 651 operators that paid royalties, 312 companies representing 48% were not recorded in the MCO register either as valid, revoked or transferred titles for the year.

A striking feature of the report was that the sum of 9.923 billion was shared by the three tiers of government in 2016, being the accumulated revenues from 2007 to 2014 from the solid minerals sector.

A breakdown of the figure shows that the Federal Government got N4.547 billion while states and local governments shared N2.306 billion and N1.778 billion respectively. The sum of N1.289 billion was also shared as derivation.

Further breakdown shows that Ogun State received the highest share of N369.84 million while Kogi and Cross River states received N317.66 million and N237.10 million respectively.

Other states among the top five recipients are Kano and Oyo states which received N208.83 million and 200.45 million respectively while Ekiti and Bayelsa got the lowest share of N91.25 million and N76.66 respectively.

The release of the 2016 report by NEITI brings to seven in the series of independent reports on the solid minerals sector published as part of efforts to ensure transparency as well as bring local and international attention to the revenues and investment potentials in the solid minerals sector.

The 2016 Solid minerals audit was conducted for NEITI by Tajudeen Badejo & Co, an indigenous accounting and auditing firm.

The independent audit is consistent with NEITI’s mandate and in fulfillment of Nigeria’s obligation to the global Extractive Industries Transparency Initiative (EITI) as an implementing country.

The NEITI 2016 oil and gas report is currently at the final stage of completion and will be released soon, while the 2017 audit process is ongoing.

Details of the 2016 solid minerals report with findings and recommendations are available on NEITI website www.neiti.gov.ng.

 

Dr. Orji Ogbonnaya Orji.

Director, Communications and Advocacy.

Abuja, October 30, 2018. The Nigeria Extractive Industries Transparency Initiative (NEITI) hereby states, for record purposes, that the $22.06b and N481.75b that are yet to be remitted by NNPC, NPDC and others to the Federation Account, reported in the media yesterday, are legacy issues arising from its audit reports for the period 1999 to 2015.

The bulk of the outstanding amounts is from NLNG dividends from the period 2000 to 2015 and outstanding payments for the value of 12 Oil Mining Licenses (OMLs) divested to NPDC between 2011 and 2013.

To say the non-remittance happened under this administration or that the money went missing from the Federation Account is therefore totally incorrect and deliberately misleading.

This clarification has become necessary based on the distortion and politicisation of the media reports of a conference hosted by NEITI in Abuja yesterday. The focus of the conference was on how to ensure better implementation of NEITI's audit recommendations, address the lingering issues in the extractive sector, and improve optimisation of Nigeria's extractive endowments for the benefit of all Nigerians.

The conference was not a fault-finding or political event. It was a solution-oriented gathering with good representation and useful contributions from government agencies (including NNPC, DPR, CBN, PPPRA etc), the private sector, civil society, academia, and the media.

The information shared for discussion is not only historical, but also not new. There was nothing in the data shared and discussed yesterday that had not been made public over time, most notably in the NEITI Policy Brief on unremitted funds released in April 2017 and in the NEITI 2015 industry audit reports released in December 2017.

Those who follow discussions on these issues closely would also be aware that various efforts have been made by different government institutions, including the Federation Allocation Accounts Committee (FAAC) and the National Economic Council (NEC) to ensure that NNPC and its subsidiaries address these legacy issues.

It is noteworthy that at the conference yesterday, the NNPC team confirmed that many of the issues under reference have either been resolved or at advanced stages of resolution.  While NEITI awaits the outcome of its ongoing audits for 2016 and 2017 to provide update on these and other issues, it is wrong to deliberately distort data from NEITI's audits and the issues arising from them for sensational or political purposes.  

NEITI hereby wishes to renew its appeal to the media and the civil society as key partners in the EITI process to always cross-check to ensure that facts align with the issues before publication.

Dr. Orji Ogbonnaya Orji.

Director, Communications and Advocacy.

* NEITI Decries Misrepresentation of Findings

Abuja, October 29, 2018. Stakeholders in the extractive industry have called for speedy implementation of the findings and recommendations contained in NEITI reports if the impact of EITI in Nigeria in areas of poverty reduction, enthronement of transparency and accountability in the extractive industry would be felt.

This was part of the resolutions taken at a national conference on remedial issues held today in Abuja.

The stakeholders drawn from companies, government agencies, civil society and the media expressed concern that  slow pace of implementation is capable of eroding the multiple gains of Nigeria’s membership of the global EITI targeted at ensuring impactful reforms that should guarantee transparency, accountability and competition in the management of the sector.

A lead presentation by NEITI at the conference identified some of the remedial issues to include unremitted amounts, underpayments, and inadequate metering infrastructure. Others are management of domestic crude allocation, licensing issues and poor governance of revenues from the industry.

The Executive Secretary of NEITI, Waziri Adio, told the conference that the objective of the conference was to bring these issues to the attention of relevant covered agencies and NEITI partners for a coordinated approach for the benefit of the country. He traced the history of the remedial issues since 1999 to NEITI’s last report in 2015 and expressed regret that many of the issues have become recurring decimals in successive NEITI reports.

In his contribution, the Managing Director, NNPC Capital, Mr. Godwin Okonkwo, who represented the Group Managing Director at the conference explained that many of the issues being raised by NEITI have either been resolved or in process of being resolved.

He called for closer partnership and collaboration between NEITI and all affected covered entities to lay many of the issues to rest in line with NEITI remediation plan.

Members of the civil society, the media and representatives of companies agreed to work together with NEITI and relevant government agencies to develop and implement a coordinated plan that will guarantee sustainable approach to address the issues.

The conference also underlined the need to strengthen the Inter Ministerial Task Team (IMTT) earlier set up by the Federal Government to address remedial issues.

The national conference is part of NEITI’s nationwide consultation programme designed to ensure that issues identified in the oil, gas and mining sector are properly addressed as part of the benefits of Nigeria’s membership of the global EITI.

Meanwhile, NEITI has decried attempts to misrepresent, sensationalize and politicize its work. This is in reaction to insinuation that unremitted amount in some of the discussion materials at the National Conference held Monday that money missing from the Federation Account under this administration. 

For the avoidance of doubt, NEITI wishes to state that the document covered the period 1999 to 2015. The unremitted amounts mentioned largely related to NLNG dividends paid for the period between 2000 and 2015 and money due from 12 assets divested to NPDC between 2011 and 2013. 

Apart from this being legacy issues, at no point did NEITI mention money missing from the Federation Account. 

NEITI hereby reiterates the need for the media and other stakeholders to seek clarification when they are not clear and resist the urge to politicize the work of the agency. 


Dr. Orji Ogbonnaya Orji.

Director, Communications and Advocacy.

Abuja, October 26, 2018. Oil, gas and mining sectors stakeholders converge on Abuja for a special Conference on resolving outstanding remedial issues identified by the independent industry audit reports of Nigeria Extractive Industries Transparency Initiative (NEITI) over the years.

The Conference, slated for 29th October 2018 is expected to attract over 150 participants drawn from governments, extractive companies, civil society leaders, media, and development partners.

Experts across the extractive industries value chain have been assembled to review the status of NEITI’s remediation issues, evolve strategies, set new targets and define next steps.

The Conference will also examine how to strengthen current remediation mechanism to yield the desired impacts. The Executive Secretary of NEITI, Mr. Waziri Adio will deliver the keynote address.

Specific issues to be discussed include pending remittances and recoverable revenues from oil and gas sector to the Federation Account, outstanding debt owed by oil and gas companies, among others.

NEITI is convinced that resolving the outstanding remedial issues in its independent audit reports will contribute significantly in deepening the ongoing reforms in the oil, gas and mining sectors, improve investment climate in the sectors and increase revenues inflows to government coffers.

Remediation, a process in which gaps identified in the NEITI’s reports are addressed, is one major challenge being faced currently by NEITI. Federal government’s response by constituting an Inter-Ministerial Task Team (IMTT) with mandate to promptly address remedial issues from NEITI reports have not adequately solved the problem.

Dr. Orji Ogbonnaya Orji.

Director,Communications and Advocacy.


Abuja, October 25, 2018. The global search for real owners of oil, gas and mining companies moves to Dakar, as a major conference on beneficial ownership disclosure in Africa begins on 31 October 2018 in the Senegalese capital.

The Extractive Industries Transparency Initiative (EITI) is organizing the conference with participants drawn from governments, extractive companies, civil society and non - governmental organizations. The over 200 participants are expected to dialogue, debate and evolve strategies to tackle the challenges posed by hidden ownership syndrome in the extractive industries.

The global EITI is convinced that knowing the real owners of companies that operate in the sector in resource-rich countries especially in Africa is fundamental to the strengthening of natural resource governance.

A statement on the conference by the EITI international secretariat shared with the Nigeria Extractive Industries Transparency Initiative (NEITI), identified illicit activities such as corruption, money laundering, tax evasion, terrorism financing, e.t.c., as part of the dangers of hidden beneficial owners of companies.

The EITI statement further explained that public disclosure of real owners of these companies would improve investment climate, reduce reputational and financial risks, and prevent illicit financial flows. Other gains include improvement in rule of law, promotion of citizens’ engagement, trust and accountability, increased revenue collection as well as creation of level-playing grounds for foreign investments to thrive.

The EITI statement further noted that in resource-rich countries like Nigeria, public disclosure of real owners of companies in the oil, gas and mining sectors could translate to billions of dollars in extractive revenue payments to governments; which could be channeled into providing programmes for poverty reduction and improved standard of living for citizens.

The conference will have in attendance experts in the extractive industries value chain to discuss emerging best practices in beneficial ownership disclosures in EITI member countries, including Nigeria. Participants will equally examine how to mobilize domestic resources in oil, gas and mining sectors. Other issues for discussion are risks management in licensing, issues of politically exposed persons and conflict of interests.

NEITI has since published a roadmap on beneficial ownership disclosures as part of Nigeria’s commitment to EITI implementation and Open Government Partnership (OGP). The roadmap is in fulfillment of President Muhammadu Buhari’s declaration at the London Anti-corruption summit in 2016 that Nigeria would undertake the development of a public register of beneficial owners of companies in the oil, gas and mining sectors.

The scope of NEITI independent audit reports has equally expanded to cover voluntary beneficial ownership disclosures. This is in addition to series of multi-stakeholders’ engagements to drive home the message that beneficial ownership disclosures is an idea whose time has come in Nigeria’s extractive sector.

The President of Senegal, Macky Sall is among Africa leaders expected to address the conference.

It would be recalled that Vice President, Prof. Yemi Osinbajo led Nigeria’s delegation to a similar conference held in Jakarta, Indonesia in 2017 where he re-affirmed Nigeria’s commitment to beneficial ownership disclosures. 

The outcome of the conference is expected to set the stage for EITI implementing countries to take steps to domesticate this important initiative through legal and institutional frameworks in their respective jurisdictions.

 

Dr. Orji Ogbonnaya Orji.

Director, Communications and Advocacy.


The Executive Secretary of Nigeria Extractive Industries Transparency Initiative (NEITI), Waziri Adio has been invited to the 40th EITI International Board Meeting holding in Berlin, Germany from the 28th to 29th of June 2018.

The Executive Secretary is expected to brief the EITI Board on status of EITI implementation in Nigeria, including the impacts and how NEITI reports have helped to shape the on-going reforms in the oil, gas and mining sector.

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