FG Rakes in over N13tn Revenue from NUPRC’s Operations in Four Years
Emmanuel Addeh in Abuja
The federal government received N13.017 trillion in revenues from the operations of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) in four years, a THISDAY computation of data from the commission has shown.
The information indicated that in 2020, the federal government raked in N2.002 trillion; in 2021, it got N2.9 trillion while in 2022 and 2023, the federal government got revenues amounting to N3.781 trillion and N4.334 trillion respectively from the NUPRC.
Essentially, the upstream regulator gets its revenues from its operations and services, including collection of royalties on oil and gas, gas flare penalty, concession rentals, bunkering, bid round fees, signature bonuses, among others.
The commission supervises all upstream petroleum operations being carried out under licences and leases in the country and processes upstream petroleum – related applications for leases, licences and permits.
Besides, it ensures timely and accurate payments of rents, royalties and other revenues due to the government from upstream petroleum operations.
According to the revenue collection data, whereas in 2020, the revenue target was N1.83 trillion, the NUPRC was able to hit N2.002 trillion, a performance of 109.4 per cent.
In 2021, the commission set a target of N3.056 trillion, but was only able to draw a revenue of N2.9 trillion from its operations for that year, leading to a revenue performance of 95 per cent.
Besides, in 2022, the NUPRC had a revenue goal of N3.196 trillion, but exceeded it to remit N3.781 trillion to the federal government, to hit an overall performance of 118.3 trillion for that year.
Also, in 2023, against an annual revenue collection target of N3.789 trillion, the commission remitted N4.334 trillion to the government, being the highest in the four years under consideration. The revenue performance for the NUPRC for that year was 114.65 per cent.
In the document, the Gbenga Komolafe-led organisation stated that in 2024, it is blocking all avenues for leakages and will execute a zero default strategy to ensure that all royalties are paid to the commission.
“ On revenue generation and the implementation of zero default strategy on payment of royalty, the commission shall in 2024 begin the implementation of a new administrative process for the management of royalty payments based on the new royalty regulations.
“The new shall be zero default system which ensures a 100 per cent payment of royalty as at when due without allowance for any default or late payment.
“The foregoing represents in broad terms the key thematic focus areas that would underpin the commission’s activities in 2024. These are in addition to the commission’s commitment to its general objectives and functions as provided in the Petroleum Industry Act (PIA) and by implication all other laws relating to upstream petroleum operations in Nigeria.
“In focusing on these areas, the commission aims at bringing into rapid effect the transformation of the sector envisaged by the PIA and ramping up the efficiency and performance of the sector.
“Furthermore, the implementation of these initiatives would in the short- and long-term increase revenues generated for government from the industry, improve the regulatory and operating environment, optimise value, generate jobs, and position the country as a destination for foreign direct investment for the sector,” the commission stated in its action plan for this year.
It explained that as a strategy-driven organisation, it was firmly committed to setting a clear agenda for the Nigerian upstream sector to engender efficiency and effectiveness in line with the PIA and government aspirations for a virile, functional, and profitable oil and gas sector.
The commission stated that it will ensure that the Regulatory Action Plan (RAP) for 2024 and the near term is implemented vigorously by all concerned in the beneficial interest of operators, service providers, industry participants and other stakeholders, all in the overriding national interest.
Part of what it intends to do to ensure maximum returns, it said, is to make sure that there’s transparency in the measurement of Nigeria’s crude oil, with a view to making sure the commission and by extension, the country is not ripped off.
It said: “Recognising the importance of revenue generation to the actualisation of government plans, programmes and budgets, the commission is poised to ensure the there’s appropriate assessment and remittance of royalty as and when due.
“This will be done through the enforcement of the Nigerian Upstream Petroleum Measurement Regulations, 2023 to ensure transparency in crude oil measurement and accounting thereby blocking leakages arising from hitherto inaccurate measurement.
“Through the Advance Cargo Declaration Regulation targeted at curbing disposal of illegally obtained crude oil majorly through stealing, a non-kinetic initiative by the commission, it will complement the fight against oil theft in Nigeria.
“There shall be application of the instrumentality of the law which among others empowers the NUPRC to: Suspend all regulatory approvals and permits until payments are made and seize crude in lieu of debt during monthly lifting programme”
According to the commission, it shall, in 2024 implement the 100 per cent hydro-carbon accounting project aimed at ensuring that all hydrocarbon produced and exported in Nigeria are efficiently and properly accounted for through reliable and efficient metering systems.
To achieve this, the commission, explained that it shall conduct an audit of all measurement points, establish a metering plan for all licences and leases and ensure that licenced metering service providers are deployed by all licensees and leases to carry out metering services in line with the metering regulations.
“The above measures will enhance the transparency and accountability in the upstream sector as well as bolster Nigeria’s credibility in the international arena and debunk negative publicity,” the NUPRC stated.
