The Nigerian National Petroleum Corporation, NNPC, said from January 2016
till date, government lost $7 billion (N2.1 trillion) to the activities of
militancy groups and oil pipeline vandals in the Niger Delta region.
The Group Managing Director of NNPC, Maikanti Baru, said this on Friday in
Abuja at the 2016 Fiscal Liquidity Assessment Committee Retreat.
Mr. Baru made a presentation on “Global Oil Prices, Militancy and
Terrorism and its Impact on Government Revenue in Nigeria’’.
He said that apart from security challenges in the region, politics,
judiciary, oil prices and production cost continued to impact negatively
on the oil industry.
“Over 7000kpd of crude oil has been lost due to vandalism this year. A
bulk of the loss is from JV assets.
“This implies that 60 per cent of oil production lost is NNPC-FGN equity.
“At an estimated price of $45 per barrel, the total 2016 revenue loss to
the Federation Account translates to about $7 billion .
“This is money that the government could have used to achieve major
infrastructural milestones.
“ This loss is equivalent to a new 7,000mw power plant; new 350kpd
refinery; over 30 per cent of National budget; and a new 1,700 kilometre
pipeline,’’ Mr. Baru said.
To resolve this, Mr. Baru said the NNPC planned to increase security of
oil and gas assets, improve its community social responsibility and the
Amnesty programme.
He said the NNPC planned “to renegotiate terms of Production Sharing
Contract with deep offshore operating companies because with the current
agreement, only 17.7 per cent of total revenue comes to government.”
The Minister of Finance, Kemi Adeosun, said that the ministry had
succeeded in reducing Federal Government’s monthly wage bill from N165
billion to N142 billion by eliminating 33,000 ghost workers.
Mrs. Adeosun, represented by the Head of the Efficiency Unit at the
Ministry, Patience Oniha, said that the ministry had discovered that it
could also save money by reviewing government’s procurement processes.
She said that through the Efficiency Unit, the ministry had succeeded in
negotiating huge discounts for government officials travelling on local
and international flights for official assignments.
Mrs. Adeosun said that the ministry had also been able to save cost by
banning sitting allowances, souvenirs at government’s functions and
unnecessary adverts which had contributed to the high recurrent
expenditure in government.
(NAN)