Nigeria:Groups Want Govt to Punish Corruption in Oil, Gas Industry

Civil society groups, under the aegis of the Natural Resources Governance Institute, NRGI, on Wednesday asked the Nigerian government to make a law to criminalize acts of impunity and corruption in the oil and gas industry.
Source:     Time:25 Apr 2016
 

Civil society groups, under the aegis of the Natural Resources Governance Institute, NRGI, on Wednesday asked the Nigerian government to make a law to criminalize acts of impunity and corruption in the oil and gas industry.

Participants at a policy dialogue in Abuja on the theme: "A decade of Unimplemented Recommendations for the Nigerian oil & gas sector" lamented the huge cost on government as a result of various corruption cases in the industry, in the last decade, that have been investigated without the implementation of their findings and recommendations.

The dialogue, organised in conjunction with the Nigerian Natural Resource Charter, NNRC, said the government's non-implementation of the various probe reports in the sector resulted in a loss of over N7.1 trillion for the period.

The reports include the various audit reports by the Nigerian Extractive Industries Transparency Initiative, NEITI between 1999 and 2012.

Other reports include the Nuhu Ribadu-led Petroleum Revenues Special Task Force on the review of the Nigerian Petroleum Industry, and the Aigboje Aig-Imoukhuede-led Technical Committee on Payment of Fuel Subsidies to petroleum products marketers.

A review of five of the reports by the Managing Director, PREMIUM TIMES Media Services, Dapo Olorunyomi, and Taiwo Ogunleye of the Nigerian Institute of Advance Studies, NIALS, highlighted key findings that were yet to be implemented and the indicted persons and agencies sanctioned.

They findings included poor records keeping, which cost government a loss of over $700 million; illicit payments and withdrawals by government agencies (N2.5 trillion), and failure to implement the recommendations and prosecute those indicted cost the government another N2.5 trillion.

Other losses included $3.03 billion in unpaid royalties; $1.3 million due to foreign exchange manipulation; N423 billion for the violation of the Petroleum Support Fund guidelines by petroleum products marketers; N1.2 trillion for unpaid domestic crude lifting settlements.

Apart from losses as a result of weak institutional and regulatory frameworks, absence of coordination among government agencies as well as out-dated laws and legislations, other findings included $755 million in unpaid signature bonuses; N117 billion for irreconcilable differences from swap oil contracts and N756 million for outstanding concession payments.

According to Mr. Olorunyomi, at a time the global industry was going digital in its operations, the Nigerian oil and gas industry was plagued by manual record keeping in its operations, apparently to suit the corruption schemes of their operators.

He said the corruption in the industry was fueled largely by the problems associated with the Nigerians National Petroleum Corporation, NNPC, and its operational processes, particularly as they related to the conflict of its roles as both operator and regulator.

"The existence of an institutional capture has made the Department of Petroleum Resources, the regulator of the industry, unable to effectively discharge its function of monitoring the NNPC, the operator, because the NNPC has effectively captured the two roles," Mr Olorunyomi said.

In his opening remarks, the Country Director, NGRI, Dauda Garuba, noted that it was ironic that the industry was the most investigated in the country, yet remained least responsive to the series of reforms by successive governments over the period.

Mr. Garuba said the development has been the only reason the industry was experiencing the worse cases of corruption and impunity as seen by the series of probes and recommendations that have remained unimplemented and culprits not sanctioned.

Former Chairman of NEITI, Assisi Asobie, who was Chairman of the opening session, blamed the lack of implementation of the reports to the ad hoc status of the various committee, which saw their dissolution immediately they completed their work with no time to follows up on their findings.

Mr. Asobie, who traced the history of corruption in the industry since the Yakubu Gowon administration to the immediate past administration of Goodluck Jonathan, said the problem has persisted, because Nigerians and the CSOs have not been able to deal with the problem according to law.

Executive Secretary, NEITI, Waziri Adio, said the ultimate responsibility of the citizens was to utilize the information and data in the various audit reports to ask questions to hold government to account.

Mr. Adio said the new leadership in NEITI intends to raise its level of engagement with the citizens and civic society groups by exploring new ways of engaging the people and mobilizing them to be sensitive to the information conveyed in its various industry audits.

He rather than the capacity to ensure transparency and accountability through the fight against corruption in the industry, what the government appears to be lack of political will to do so.

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