NEITI Recovers $4.85bn from Oil Companies, Raises Concerns Over Unpaid Liabilities Amid Nigeria’s Budget Deficit

The transparency initiative of the extractive industries of Nigeria (NEITI) said that it had managed to recover $ 4.85 billion in unpaid liabilities due by oil and gas companies in Nigeria, marking an important stage in the continuous efforts of the agency to promote transparency and responsibility for the extractive sector.

The recovered sum is part of a greater number of $ 8.26 billion in the current obligations identified in the oil and gas audit report in Neiti. However, despite this recovery, billions remain unpaid, which raises concerns about income leak and the government’s financial burden when it fights to finance critical projects.

Speaking at a press conference in Abuja, the executive secretary of Neiti, Dr Orji Ogbonnaya Orji, said that if significant progress had been made in fundraising, unresolved financial responsibilities continue to pose a major challenge.

“Until now, more than $ 4.85 billion has been recovered from disclosure of $ 8.26 billion made by Neiti in its 2021 oil and gas report. In 2023 industry reports published in September 2024, Neiti revealed liabilities of $ 6.175 billion and N66.378 billion N. Funding its 2025 budget, “said Orji.

He deplored that despite the continuous efforts of Neiti to ensure financial responsibility, several oil and gas companies are still defaulting on their payments. He urged the Federal Inland Revenue Service (FIRS) and the Uripurian Upstream Oil Commission (NUPRC) to adopt more strict implementing measures to prevent new loss of income.

“Neiti therefore asks the relevant agencies responsible for collecting these income to do the need and support our governments at all levels to provide the essential infrastructure to our citizens,” said Orji.

To underline the economic importance of these unpaid debts, Orji provided an analysis of the impact of funds for national development if they were completely recovered.

“Analyzes of the way in which these responsibilities, when paid, could support the mobilization of inner income from the federal government reveal that responsibilities, when converted to 1,500 N into a dollar, would amount to 9.33 Billions of Nairas.

“The sum is more than the total budget of the Federal Government for Health, Education, Agriculture and Food Safety, which totaled 8.73 Billions of Nairas. Tillion for 2025, “he said.

Orji stressed that the urgency of revenue recovery could not be overestimated, because Nigeria faces increasing budgetary challenges. He called on government agencies relevant to ensuring that oil companies comply with their financial obligations, noting that an improvement in income mobilization is essential for the country’s economic stability.

In related development, Neiti has announced its intention to examine a series of disinvestments of oil blocks worth $ 6.03 billion, involving 26 assets sold by five international oil companies (IOC). Disinvestment includes major agreements such as the sale of $ 2.4 billion in the Renaissance, the transfer of $ 1.28 billion from Exxonmobil to Seplat and the sale of 860 million dollars in total to Chappal Energies. Orji said that these transactions reshape the Nigeria oil and gas landscape, which makes it imperative to ensure that they are conducted transparently and in accordance with regulatory requirements.

“Neiti recognizes the urgent need for transparency in these transactions to protect national interests, reception communities and income flows. To achieve this, it will extend industry reports to include dedicated sections on divestists and intensify collaboration with NNPC LTD. And other government agencies to disclose the term sales data, ”said Orji.

He explained that Neiti would work in close collaboration with the Nigerian regulatory commission upstream upstream (NUPRC) and the Nigerian National Petroleum Company Limited (NNPC LTD.) to supervise these divests and guarantee the complete disclosure of all the financial, social and environmental aspects of transactions. The agency will expand its industry reports to include detailed sections on divests while intensifying collaboration with government agencies to disclose the term sales data.

Beyond financial transparency, Orji has raised concerns concerning the environmental impact of these disinvestments. He warned that some oil companies could have left their operations without adequately approach the environmental damage caused by their past activities.

“Neiti will work with regulation organizations, including the Ministry of the Environment, to ensure that oil companies are held responsible for cleaning costs and correction efforts,” said Orji.

He stressed that the reception communities should not be left to undergo the consequences of oil exploration and that appropriate cleaning efforts must be applied before companies are allowed to complete their outings.

In addition to the disinvestment review, Neiti should examine the long -term sales of crude oil by Nigeria, in particular transactions where oil is exchanged for loans. The decision comes in the midst of the growing concerns of local refineries concerning the inadequate supply of crude oil, which affected interior refining operations.

Ordji, Orji revealed an overview of the larger industry that Nigeria had won $ 831 billion in petroleum and gas income since the start of sectoral audits 23 years ago. He also revealed that more than $ 4.85 billion had been recovered from disclosure of $ 8.26 billion made in the oil and gas report in 2021 in Neiti.

“While we start reports of solid oil, gas and minerals in 2024, we will expand our declaration to process sales and pre-export financing transactions,” he said.

While recognizing the progress of Nigeria in the promotion of transparency in the extractive sector, Orji noted that institutional constraints and financing limitations continue to pose challenges to obtain full responsibility.

Neiti’s conclusions are involved at a time when the Nigerian oil industry is experiencing a quarter of work, the IOCs leaving operations on land and in shallow water due to safety problems.

Earlier this year, Shell completed the sale of its Nigerian subsidiary onshore, Shell Petroleum Development Company (SPDC), in Renaissance, a mainly local business consortium. This decision was part of Shell’s wider strategy to focus on deep and integrated gas assets. Similarly, Totalenges sold its 10% stake in 15 oil extraction leases and the Forcados and Bonny export terminals with Chappal energies in Mauritius for $ 860 million.

Experts attribute these outings to increasing insecurity and vandalism of oil infrastructure in the Niger Delta. Pipeline attacks and increasingly rampant raw flights, multinational oil companies have been increasingly difficult to maintain Onshore operations. This led them to focus on offshore fields, where security risks are much lower.

The latest Neiti report highlights the urgent need for a stricter application of financial responsibility in the Nigeria oil sector. With billions of unpaid bonds, the government is faced with an essential challenge to ensure that oil companies are taking on their financial responsibilities while addressing the economic consequences of IOC’s divests.