The Nigeria National Petroleum Corporation (NNPC) has said that the claim that international oil companies operating in Nigeria owe the Federal Government over $60billion with respect to Production Sharing Contracts is hard to succeed.
The Chief Operating Officer, Upstream, NNPC, Mr Roland Ewubare, in an interview published in NNPC News, stated this when asked if it was possible to recover the $60bn said to have been lost to the delay in the review of the PSC law after the price of oil rose above the $20 stipulated by the law.
The Tide recalls that in November last Year, President Muhammadu Buhari signed the bill that amended the Deep Offshore (and Inland Basin Production Sharing Contract) Act after its passage by the National Assembly.
The Attorney General of the Federation, Malami Abubakar, had repeatedly asked the IOCs to pay $62bn (over N20tn) owed to the Federal Government with respect to the PSCs.
Ewubare said the NNPC had in the past tested the proposition around the possibility of getting the money from the IOCs.
He said the corporation sought legal advice and got legal opinions in writing from legal experts.
He said, “The crux of those opinions is that we slept on our right – we had the right to ask and we didn’t ask and so it is gone.
“The second position was that what we really lost was not quantifiable dollars and cents or naira and kobo but an opportunity to make that money and that it is hard to make a legal claim that will succeed on the basis of an opportunity that was lost.”
According to Ewubare, the other aspect is that at some point in the course of engagement, there was an argument around the PSCs and the NNPC took certain steps that it believed, based on its interpretation of the law, were justified.
He said, “Those steps resulted in a dispute which went to arbitration because the argument of the other party was that NNPC has gone ahead to try to correct the anomaly through self-help by taking more barrels of oil than it was entitled to.
“At the arbitration, NNPC has won against Esso Exploration and Production Nigeria Limited and they are going on appeal. So, clawing back that money is not quite a straight-forward affair.”
The nation’s oil and gas production structure is majorly split between joint ventures onshore and in shallow water with foreign and local companies and the PSCs in deepwater offshore, to which most of the IOCs have shifted their focus in recent years.

The Executive Chairman, Federal Inland Revenue Service (FIRS), Mr. Muhammad Nami, has blamed non-discretionary tax waivers, illicit financial outflows and high overhead costs for the organisation’s failure to meet its tax revenue targets in recent times.
Nami stated this in Abuja at the weekend at a Senate interactive session with revenue generating agencies, aimed to improve the internally generated revenue (IGR) of the Federal Government through non-oil revenue sources.
A statement by Director, Communications and Liaison Department, FIRS, Abdullahi Ahmad, quoted Nami as saying, “Nigeria loses a lot of revenue through tax waivers granted to big companies which otherwise would have been taxed to buoy up government revenue. Also, illicit financial flow is a major cause of revenue loss to Nigeria.
“Coupled with this is the operational cost of the FIRS which is also high compared to the statutory provisions for the running of the organization. I am new in the FIRS but upon my assumption of office, I have discovered that these, among other factors, contributed to making the FIRS unable to meet its target in recent times.”
Consequently, Nami canvassed better official discretion in granting tax waivers, even as he assured that he is working hard at the FIRS in collaboration with relevant government agencies to stem illicit financial flow, especially via profit shifting by multinationals operating in the country.
The FIRS boss urged the National Assembly to assist the organisation in this regard in order to increase government revenue towards the modernization of public infrastructure in the country.

Residents and road users at Nkpolu axis of the East/West Road can now heave a sigh of relief as the Ministry of Niger Delta Affairs has started remediation work on the road.
The Tide reports that the Ministry of Niger Delta Affairs on Saturday deployed personnel and equipment to the site, with special attention on the drainages and water channels.
Speaking to The Tide, the Ministry of Niger Delta Affairs Site Engineer, Henry Abite, said the ministry had reaffirmed its preparedness to rehabilitate the drainages and water channels as a remediating measures, saying as soon as the flood water are channeled to the right directions the problem of the road would be half solved.
The chairman of Nkpolu-Rumuigbo Community Development Committee, Achinike Orubuogwu in his comment said that the community would provide needed support for the project to succeed.
He said, “The Ministry of Niger Delta Affairs is here to carry out the repair of the road today, we are also here to receive them. We will join hands and partner with them, especially in providing them all the necessary enabling conducive environment for them to do whatever they want to do”.
It would be recalled that the Nkpolu axis of the East/West Road had long been abandoned by the Federal Government following which several protests were staged to draw the attention of the Federal Government to the area.
Mid last year, the Minister for Niger Delta Affairs, Senator Godswill Akpabio promised to fix the road when he visited the area, but nothing was done until last Saturday.
Meanwhile, commercial drivers and other road users had commended the move by the Niger Delta Affairs Ministry.
Speaking to The Tide, a taxi driver, Deji Kehinde, expressed joy over what he described as God’s intervention, saying “There is nothing people have not done to draw the attention of the Federal Government to come and fix the road, yet no answer.
Another road user, John Akah, who commended the efforts of Federal Ministry said “the action is long overdue and we have been expecting Federal Government presence on this road rehabilitation for over five years and now that they are here, we wish they do a thorough job that would be sustainable”.