Wednesday , October 28 2020
Breaking News
Home / Business / NNPC Seeks To Recover $7bn Deductions By Oil Majors

NNPC Seeks To Recover $7bn Deductions By Oil Majors

NNPCThe Nigerian National Petroleum Cooperation (NNPC) has commenced the process of recovering over $7bn in over-deducted tax benefits from joint venture partners on major capital projects.

Mallam Garba Shehu, Senior Special Assistant to President Buhari on Media and Publicity, in a statement on Sunday, said the corporation has also engaged an international accounting firm to ascertain the exact amount due to government on the Strategic Alliance Contracts entered into by Nigerian Petroleum Development Company, where up to $2.46bn of government money was to be recovered.

Dr. Ibe Kachikwu, NNPC’s Group Managing Director, in a report submitted to Buhari detailing the corporation’s successes so far, revealed that NNPC has commenced performance measurement and benchmarking.
He added that the corporation also started what it described as Value for Money Review of NNPC and the JV companies covering the period of 2008 to 2013.

The report, according to the statement, indicated that the new measures might lead to further cost recovery for NNPC.

The report also revealed that after an extensive investigation of the various toxic crude oil for refined products’ swap contracts, a total of $420m had so far been reconciled in favour of NNPC and was now due for recovery from the legacy OPA/SWAP contracts.
“Out of the reconciled amount, $277m had been recovered in lieu of products and the recovery effort is still ongoing,” the statement added.

According to the report, the NNPC boss stated that he was committed to the continued review of all existing contracts and addressing the ones that were not favourable to the corporation.
It noted that significant cost reductions were also expected to ensure that the corporation remained profitable in the prevailing low crude oil price regime.

NNPC upstream operations are in joint partnerships with the major oil companies. These multi-national exploration and production companies are operating predominantly in the on-shore Niger Delta, coastal offshore areas and lately in the deep-waters.

As with many other developing countries, the multinationals in Nigeria had been operating under what is called a concession system, with NNPC being the concessionaire, while the companies are the operators.
NNPC is responsible for the management of the exploration bidding rounds for oil and gas. The multinational oil companies operate in partnership with NNPC under Production Sharing Contracts.

The statement from the Presidency on Sunday did not name the joint venture partners from which the corporation plans to demand the refund.

However, some of the international oil companies that are JV partners of the NNPC are, Shell, Agip, Mobil, Chevron and Texaco, among others.

Comments

comments

Check Also

Nigeria’s Inflation Hits 13.71% In September…… Highest In 30 Months

Nigeria’s inflation rate rose to 13.71%  year-on-year in September 2020, hitting its hghets level in …

UAE Reverses Visa Restriction As Nigeria Lifts Ban On Emirates Airlines

The Federal Government has lifted the ban on Emirates Airlines from operating in Nigeria just …

Social Media Auto Publish Powered By : XYZScripts.com