By Sebastine Obasi

THE Executive Secretary of Nigerian Extractive Industries Transparency Initiative, Mr. Waziri Adio, has blamed the indebtedness of  the International Companies,  IOCs, to Nigeria on the gaps in Nigeria’s laws.

Adio said the loophole in the country’s laws has made it possible for some IOCs to owe Nigeria up to $600 million.

His blame came as he identified lack of political will and the inability of successive governments to implement recommendations on remediation in the nation’s oil and gas industry.

Adio, who stated this during a visit to Vanguard Head Office at Apapa, Lagos, said there is need for Nigeria to strengthen its laws and institutions, especially in the oil and gas sector, so as to achieve maximum results in its revenue collection. His assertions came on the heels of the recently released 2013 NEITI report, which stated that there was under assessment of petroleum profit tax, PPT, from Chevron and Mobil

He said, “In the 2013 NEITI report, the under assessment for oil companies came to about $600 million. Is it their fault? I will say no. Why is that so? Nigeria had an Memorandum of Understanding, MUO with the oil companies. The MOU expired. There is a procedure for renewing the MOU. While that is going on, there is also room for certain things.

“There are two pricing methodologies; there is what is called the realisable price which the oil companies prefer. There is the official selling price, which the government prefers. But because of the discrepancy in the MOU, if you use what government will favour and what the companies will favour the country lost about $600 million.

“It is not like Chevron or Mobil is cheating Nigeria. If we put our house in order, this thing cannot happen. We should place more emphasis on systems, processes and procedures that will put some of these things in check.

“There is a lot of collusion by people who have benefited from people over time to make sure that things remain the way they are, to make sure that the system is dysfunctional.”

The NEITI boss however regretted that the remediation function of the organisation has not worked due to political interference and the inability of successive governments to exhibit transparency and accountability.

He said. “Remediation is out of our hands. We come out with recommendations. We have a platform called IMTT, Inter-Ministerial Task Team, where we bring all the government agencies together to look at issues affecting the government.

“However, since 2007, when we have been meeting, nothing much has been achieved in that regard. Nothing much has been remedied because of two things; One, we were meeting with people we do not have control over. “We do not have any way of sanctioning them. We are also dealing with people who do not have any incentive to change because they know they have protection.”

“Similar to that is lack of political will to drive certain things through because successive governments also benefited from the status quo. There is a vested interest in keeping the NNPC the way it has always been. For most Presidents, NNPC has always been the piggy bank. It has been opaque.”