Nigeria earned a total of $32.63 billion from the oil and gas sector in 2018, indicating a 55 per cent increase on the $20.99 billion recorded from the sector in 2017.
A breakdown of its latest oil and gas industry audit, the Nigeria Extractive Industries Transparency Initiative (NEITI), showed that company-level financial flows into government coffers were $16.6 billion, while flows from sales of federation crude oil and gas accounted for $16.billion.
According to a five-year trend analysis of earnings from the extractive sector showed a 54.6 per cent drop from $54.6 billion in 2014 to $24.8 billion in 2015. The earnings further dropped by 31.2 per cent to $17.05billion in 2016, but increased by 23 per cent to $20.99 billion in 2017 and by 55 per cent to $32.63 billion in 2018. Though the last two years bucked the trend of persisted decrease since 2014, the revenues from the sector in 2018 were still a staggering 40% below the $54.6 billion earned in 2014 when oil prices commenced a precipitous fall.
The report disclosed that “out of the $32.63 billion earned from the sector in 2018, the sum of $19.92 billion was transferred
[directly]
into the Federation Account, while $5.21billion and $4.04billion were transferred into the JV Cash Call Account and Nigerian National Petroleum Corporation (NNPC) designated accounts respectively.”
The report further disclosed that “$2.10billion was transferred into third parties project financing accounts and $1.37billion were recorded as subnational transfers”.
On production, the total crude oil production in the country within the period under review was put at 701 million barrels, representing a slight increase of 1.5 per cent when compared to 690 million barrels produced in 2017.
A breakdown showed that Joint Ventures (JVs) contributed highest production of 315 million barrels, followed by Production Sharing Contracts (PSCs) which recorded 270.610 million barrels. Other funding arrangements like Sole Risk (SR), Marginal Fields (MFs) and Service Contracts (SCs) accounted for 92.2 million barrels, 22 million barrels, and 1.3 million barrels respectively.
“JV companies’ production increased by 3.12% in 2018 compared to 2017, while PSC operators’ production decreased by 10.90%. Similarly, SR operators’ production increased by 58.72% in 2018 compared to 2017. Production from the SC decreased by 10.27% while production from MF operators increased marginally by 1.18%,” the report stated.
The NEITI report further disclosed that total crude oil lifted for both export and domestic sales in 2018 was 701 million barrels, representing a 1.9% increase when compared with total liftings of 688.3 million barrels in 2017.
