One highlight of the latest sectorial audit of the Nigeria Extractive Industries Transparency Initiative (NEITI) is its finding of indebtedness by 51 oil and gas companies to the federation account to the tune of N1.32 trillion. Although said to be a vast reduction from the 2019 figure of N2.6 trillion owed by 77 companies, the ordinary citizen cannot but wonder how the debts, supposedly collectible revenues due to the Federation Account by the Nigeria Upstream Petroleum Regulatory Commission (NUPRC) and the Federal Inland Revenue Service (FIRS) have remained a perennial feature of the public accounts system, and even more so now that the government, in the words of NEITI, “is in dire need of revenues to rebuild the nation’s infrastructure and improve the investment climate in the country.”

To begin with, this would not be the first time such grave issues of non-remittance of due revenues would be made against the major oil companies. In fact, those who believe that the country has no business going on a borrowing binge, have a fresh but compelling argument on why the country should rather look inwards. The argument has always been – and it remains plausible – were our officials to deploy a fraction of the energies junketing in search of new loans in seeking not only to block all avenues for revenue leakages but ensuring that due revenues are promptly paid to the federation account, the nation’s finances ought to have fared comparatively better by now.

We recall a similar issue cropping up in 2019, when the Federal Government, through the Office of the Attorney-General of the Federation and Minister of Justice, accused International Oil Companies (IOCs) of denying the country of a whopping $62.1 billion accruals under the Production Sharing Contract (PSC). Whereas the joint operating agreement had envisaged a review of the profit-sharing formula with Nigeria’s partners once crude oil prices at the international oil market rose above $20 per barrel, it turned out that our officials chose to look the other way from October 1998 when oil prices rose above the agreed threshold while the oil companies conveniently kept mum. By the time the books were finally opened in 2018, some $62 billion was found to be outstanding. Till date, the status of that debt remains shrouded in utmost secrecy despite the avowals to collect same.

Among the many questions that pop us this time around is whether the collecting agencies – notably the FIRS and NUPRC are themselves even aware of the liabilities; or if they are, whether adequate or even effective mechanisms currently exist to ensure their prompt remittances. In other words, are there serious measures in place to go after the debtors? And who are these debtors by the way? For far from being matters for routine reconciliation, they touch upon the fundamentals of the sector’s accounting practices right up to issues of corporate governance, global best practices as indeed compliance with the laws of the country. They highlight the disturbing but nonetheless notorious fact about the lack of integrity in the nation’s public finance system. It explains the relative ease with which these could be manipulated by unscrupulous international oil companies. It is high time the country found a way to deal with such untoward practices permanently.

It is trite to state that the country desperately needs the money at this time. But even if the situation were not as bad, the liabilities being inextricably linked to the operations of these entities are mandated by law. Such malpractices, were they to have been done in the home countries of the offenders, would have attracted severe penalties. A strategy of ‘name and shame’ would therefore seem in order for the time being; even as the relevant agencies take necessary steps to recover every kobo owed.

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