Lawmakers To Investigate Estimated $27bn Oil Revenue Loss

Parliament in session

The House of Representatives has resolved to investigate Nigeria’s alleged estimated loss of $27 billion oil revenue to international oil companies since 1999.

The resolution was passed at the plenary on Wednesday after a debate on the bill presented by President Muhammadu Buhari seeking to increase Federal Government’s share of the revenue accruing from oil.

The Bill for an Act to Amend the Deep Offshore and Inland Basin Production Sharing Contracts Act, CAP D3 Laws of the Federation of Nigeria 2004, to Review the Share of the Government of the Federation in the Additional Revenue Under the Production Sharing Contracts was passed for second reading.

The existing Deep Offshore and Production Sharing Act provides that zero royalty be paid by IOCs who drill beyond 1000 meters until such a time when crude prices shall exceed $20 per barrel.

While the $20 benchmark has been crossed since 1993 the federal government has failed to activate the clause, resulting to substantial loss of revenue.

According to the House, it means the companies have been keeping excess revenue based on the $20 agreement irrespective of the current prevailing market price.

Leading the debate on the bill, the Deputy Majority Leader, Mr Idris Wase, urged the lawmakers to support the bill.

However, Mr Uzoma Nkem-Abonta from Abia State observed that lawmakers did not have the hard copies of the bill to allow them debate it adequately.

But the Deputy Speaker, Mr Lasun Yussuff, however, urged the Speaker of the House, Yakubu Dogara, who presided over the session, to allow the debate to go on while appealing that more legislative days be set aside for the debate.

Lasun argued that as an engineer with working knowledge of the oil sector, he knew that the federal government has little control over deep offshore oil exploration as it stands.

“We may end up being pushed out of the sharing formula in the future because the IOCs own the expertise and funds, and they can decide to apply international laws to claim the locations of the deep offshore wells,” he said.

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