The House of Representatives Ad-hoc committee investigating gas flaring in Nigeria, has vowed to recover the sum of over $9 billion gas flaring fines imposed by Federal Government on erring local and foreign companies operating in the Oil and Gas Companies industry.
The Chairman of the committee Mr Ahmed Munir stated this during the post-investigative hearing briefing attended by various stakeholders drawn from Federal Ministry of Environment, Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), National Oil Spill Detection and Response Agency (NOSDRA), among others.
Mr Munir assured that the 10th Assembly will do within its powers to ensure the recovery of all unpaid levies as well as compliance with extant legislations and regulations.
He said: “I can assure you that we will not take this lying down. There are two ways to go about it, we have the issues of penalties that are not paid, amounting to about $9 billion or thereabout, that one is there. We know how to recover it. Secondly, going forward, those that are still polluting how do you ensure you get it down to zero and what are the penalties that are going to be out in place.
“Thirdly, the big difference between then and now is, we now have a PIA in place so how do you implement it. Where we have loophole that’s why we are here to hear from the people concerned. Is there any amendment that will be required?
In his address, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) Chairman Gas Monitoring Committee, Mr. Patrick Mgbebu disclosed that the gas flare penalty payment regime from 2013-2018 (2018 Jan-June) was US$0.30, while from 2018 (July-Dec) to 2023 It Is pegged at $2.00.
Mr Mgbebu said penalties payable amounted to $3,465,299,226.55 and the value of gas would have been $12,403,000,001.20 if the gas was sold and not flared.
“The Commission compared the data from NOSDRA with the data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the following observations were made that the volume of gas flared according to NOSDRA and NUPRC were 838,667,211 Mscf and 700,975,019 Mscf respectively. The difference which is 137,692,192 Mscf indicated that the Federation Account was shortchanged. It should be noted that the comparison covered three years from 2020 to 2022.
“That the value of gas flared according to NOSDRA and NUPRC are $320,583,355.48 and $43,325,050.76 respectively. As such the variance Indicated that the Federation Account was shortchanged by $277,258,304.72.
The Speaker Tajudeen Abbas who was represented by the Chief Whip, Usman Kumo observed that gas flaring and venting has been a significant environmental, economic, health and social concern in the country for many years.
According to him, about $2.5 billion is being lost annually to gas flaring.
The Director General National Oil Spill Detection and Response Agency NOSDRA, Mr. Idris Musa, who earlier explained that the extant penalties on gas flaring are to serve as deterrent, however recommended that the penalties on gas flaring should be increased.
According to him, a total of 3.8 billion thousand standard cubic feet per day was flared between 2013 to date while total sum of $7.6 billion penalties are payable.
To this end, the committee resolved to summon all the Chief Executive Officers of 19 oil and gas companies and others to appear before the Committee on Tuesday, 25th July, 2023.