The Nigeria Extractive Industries Transparency Initiative (NEITI) has announced a review of divestments involving 26 oil blocks worth $6.03 billion by five International Oil Companies (IOCs), amid lingering environmental concerns raised by host communities and other unresolved issues.
The Executive Director, NEITI, Ogbonnaya Orji, said this during the agency’s first quarter media briefing in Abuja.
|
|
The transactions include notable sales such as Shell to Renaissance ($2.4 billion), ExxonMobil to Seplat ($1.28 billion), and TotalEnergies to Chappal ($860 million).
Mr Orji, while briefing journalists, said the oil and gas divestments were reshaping Nigeria’s industry, hence the need to ensure that the divestments adhered to due process.
|
|
|
|---|
He said NEITI would strengthen collaborations with the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian National Petroleum Company Limited (NNPC Ltd.) to ensure full disclosure of financial, social, and environmental aspects of divestments.
“NEITI recognises the urgent need for transparency in these transactions to protect national interests, host communities, and revenue flows.
“To achieve this, NEITI will expand industry reports to include dedicated sections on divestments. We will intensify collaboration with NNPC Ltd. and other government agencies to disclose forward sales data.
“NEITI will promote greater public awareness and engagement in asset transfers and ensure transparency in forward sales (pre-sales of crude oil and gas) to impact government revenues and fiscal stability,’’ he said.
Mr Orji, while emphasising ensuring due process and proper environmental remediation in these deals, expressed concerns over unresolved environmental issues in oil-producing communities.
He called for collaboration with regulatory bodies such as NUPRC and the Ministry of Environment to ensure transparency and enforce accountability for clean-up costs and remediation efforts.
Mr Orji expressed concern that some of the divestments might not have properly addressed environmental issues raised by oil producing communities.
Also, following complaints of inadequate supply of crude oil by local refineries, NEITI said it would review the forward sales of Nigeria’s crude oil by the Federal Government in exchange for loans.
He stated that Nigeria had earned $831 billion from oil and gas in the past 23 years when NEITI began the conduct of the audit of the sector.
He also disclosed that over $4.85 billion had been recovered from the disclosures of $8.26 billion made in its 2021 oil and gas report.
“As we commence the 2024 Oil, Gas, and Solid Minerals Reports, we will expand our reporting framework to address: Forward sales and pre-export financing transactions,” he said.
The executive secretary said while Nigeria had made progress in ensuring transparency in the oil and gas, and solid minerals sectors, a lot of work still needed to be done regarding institutional constraints and funding limitations.
READ ALSO: Tapping into Nigeria’s Services Export Potential: Goldmine Waiting to be Harnessed
The review by NEITI, a key agency tasked with enhancing openness and accountability in Nigeria’s extractive sectors, brings to the fore environmental concerns voiced by host communities affected by decades of oil exploration and extraction activities.
These communities have often borne the brunt of ecological damage, including oil spills, gas flaring, and water contamination, which have severely impacted agriculture and fisheries—their primary sources of livelihood.
The NEITI’s intervention seeks not only to audit the financial aspects of these divestments but also to push for a resolution to environmental liabilities and ensure that future operations adhere to stricter environmental and social governance standards. Also, this review occurs amidst a shifting global energy landscape, where there is increasing advocacy for sustainable and renewable energy sources.
(NAN)
Discover more from Premium Times Nigeria
Subscribe to get the latest posts sent to your email.
