Nigeria Rakes In $21bn From Its Oil, Gas Sector In 2017 –NEITI

The Nigeria Extractive Industries Transparency Initiative (NEITI) has disclosed that Nigeria earned about $21 billion from the industry in 2017, in a recent report released by the group and made available to journalist by NEITI, the Director of Communication, Dr Orji Ogbonnaya Orji, indicated a 23 per cent increase from the $17.05 billion earned in 2016 and 15 per cent lower than 24.79 billion inflows recorded in 2015.

A breakdown of the inflows showed that crude oil and gas sales topped the table with about $10.19billion, while other financial flows accounted for about $10.13billion. Flows to other entities like the Niger Delta Development Commission (NDDC), Nigeria Content Development Monitoring Board (NCDMB) among other stood at $669.05million.

In a five-year comparison of revenue flows from the oil and gas sector, the report revealed that “there was a steady decline in year-on-year revenues from 2013 to 2016, with the sharpest drop of 55 per cent in 2015 compared to the preceding year. The year under review experienced a 23 per cent increase in revenues from $17.055billion in 2016 to $20.988billion in 2017”. In effect, 2017 witnessed a halt in the steady revenue decline witnessed in the sector since 2013.

According to the report, inflows from the Nigeria Liquefied Natural Gas as dividend, interest and loan repayment stood at $834million, indicating an increase of 114 per cent from the 2016 figures of $390million.

In relation to oil production during the period under review, a marginal increase of 4.75 per cent (690,465 mbbls) as against the 659,137mbbls produced in 2016 was recorded.

The increase in revenues compared to the increase in production volumes was attributed to the increase in oil prices. The report further pointed out that average crude oil price was higher in 2017. It was sold for an average of $54.44 as against the $43.73 in 2016, and this signifies an increase of 24.5 per cent.

According to the NEITI report, out of the 690,465mbbls of crude oil produced in 2017, a total of 688,291mmbls was lifted. Though marginal, this represented an increase from the 668,147mmbls lifted in 2016.

The report also showed that NNPC lifted a total of 241 million barrels (mbbls) of crude oil on behalf of the federation. A breakdown of the liftings shows that federation exports accounted for 135million barrels while the domestic crude liftings accounted for 106million barrels. The report further disclosed that the federation exports volume went down by 36 per cent from 211mbbls in 2016 to 135mbbls in 2017. While liftings by the companies amounted to 447mbbls, joint venture operations, production sharing contracts and sole risk operators accounted for 130mbbls, 223mbbls and 79million barrels respectively. Moreso, marginal field and service contract operators lifted 15mbbls and 1mbbls during the year under review

On crude allocation for domestic use, the report indicated that “In 2017, the NNPC allocated 105.925Mbbls for domestic use. While 25 per cent of this quantity was supplied to the refineries, 69 per cent was on the other hand utilised for the Direct Sales and Direct Purchase arrangement.

One of the key findings of the 2017 oil and gas report was that despite the improved performance of the oil and gas sector in 2017 when compared to 2016, the projected production volumes were not realized. “The reduction in projected production figures due to unscheduled maintenance and repair of equipment posed a challenge to production in the year under review”, the report stated.