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Senate to investigate 7 oil companies over refusal to remit $21 billion

Seven international oil companies in Nigeria will be investigated by the Senate. The lawmakers have instructed three committees to probe the oil companies after a motion from the Vice-Chairman, Senate Committee on Petroleum Resources, Ifeanyi Ubah. 

Ubah had informed the Senates during its session that the oil companies whose names were not listed breached the provisions of the Production Sharing Contracts Act. It was disclosed that the oil firms refused to remit about $21 billion to the national treasury. 

The Senator moved the motion on the bases of the Deep Offshore and Inland Basin Production Sharing Contract Act Cap D3 LFN 2004 (PSC Act) that became effective on January 1, 1993. Ubah said the law was meant to be reviewed after 15 years. 

Impact of failing to review: Ubah argued that the Act of the National Assembly (NASS) regulates the sharing of additional revenue between the Nigerian National Petroleum Corporation (NNPC) and the various oil companies. However, the failure to review the legislation had cost the Federal Government $21 billion in 20 years. 

Ubah corroborated his claim with the statement of the Minister of State for Petroleum Resources after a meeting of the Federal Executive Council on December 14, 2017. He called for an investigation to determine why the major provisions of the Production Sharing Contracts Act weren’t reviewed. 

According to him, the share of the Federal Government aside from the $20 crude oil price, was designed to be beneficial to the FG economically in accordance with the provisions of the Act. 

Committees to investigate: The Senate directed the committees on Petroleum Resources Upstream, Judiciary and Legal Matters, and that of Finance to probe the issue raised by Senator Ubah. 

Senate has been busy: The Senate has been busy of late. The Lawmakers recently rejected the proposed 7.5% Value Added Tax (VAT) currently planned by the Federal Government to take effect by January 2020. 

The Senate also announced plans to impose a 9% tax on Communication Services like Voice Calls, SMS, MMS, Data usage both from Telecommunication Services Providers and Internet Service as well as Pay per View TV Stations. 

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