Nigeria delays oil deal amid confusion

LAGOS – Nigeria has put off talks with its major Western oil investors on new contract guidelines because of confusion in government over how much tax the companies pay, a top government official said on Tuesday.

Tony Chukwueke, director of the Department of Petroleum Resources, said four government departments each had different information on how much tax the companies were paying and the government did not want to enter talks until the matter was cleared up. “It is not fair that the Federal Inland Revenue Service, the Ministry of Finance, the Nigeria National Petroleum Corp.and Department of Petroleum Resources have different numbers all describing the same thing and none of them is correct,” Chukwueke told an industry conference.Almost all of Nigeria’s 2,4 million barrels a day of oil is produced by five joint ventures involving major Western oil companies and state-run Nigerian National Petroleum Corp.The industry became a haven for corruption and mismanagement during 15 years of military dictatorship until 1999, and it has proved resistant to reform under President Olusegun Obasanjo.Nigeria is the world’s eighth-largest oil exporter but billions of petrodollars have been stolen by corrupt officials or squandered.Tax and other conditions of the joint ventures are governed by a memorandum of understanding, which was last revised in 2000 and has been due for renewal since 2003, Chukwueke said.The companies and government disagreed earlier this year over the rate of taxation that applies to oil produced above US$30 (N$306,50) per barrel, and the government has demanded hundreds of millions of dollars in back-taxes.The ventures involve ExxonMobil, Royal Dutch Shell, Chevron, Total and Agip.- Nampa-Reuters”It is not fair that the Federal Inland Revenue Service, the Ministry of Finance, the Nigeria National Petroleum Corp.and Department of Petroleum Resources have different numbers all describing the same thing and none of them is correct,” Chukwueke told an industry conference.Almost all of Nigeria’s 2,4 million barrels a day of oil is produced by five joint ventures involving major Western oil companies and state-run Nigerian National Petroleum Corp.The industry became a haven for corruption and mismanagement during 15 years of military dictatorship until 1999, and it has proved resistant to reform under President Olusegun Obasanjo.Nigeria is the world’s eighth-largest oil exporter but billions of petrodollars have been stolen by corrupt officials or squandered.Tax and other conditions of the joint ventures are governed by a memorandum of understanding, which was last revised in 2000 and has been due for renewal since 2003, Chukwueke said.The companies and government disagreed earlier this year over the rate of taxation that applies to oil produced above US$30 (N$306,50) per barrel, and the government has demanded hundreds of millions of dollars in back-taxes.The ventures involve ExxonMobil, Royal Dutch Shell, Chevron, Total and Agip.- Nampa-Reuters