Economy
NEITI Calls for Review of Oil Producing Agreements
By Modupe Gbadeyanka
The need to urgently review the Deep Offshore and Inland Basin Production Sharing Agreement between Nigeria and oil companies has been stressed by the Nigeria Extractive Industries Transparency Initiative (NEITI).
In a statement signed by its Director in charge of Communications and Advocacy, Dr Orji Ogbonnaya Orji, the agency explained that the urgency to review the obsolete legislation without further delay was in view of the revenue losses to the federation by the use of the old agreement in computation of revenues to be shared between the government and oil companies.
NEITI recalled that the Deep Offshore and Inland Basin Production Sharing Contracts Act of 1993 provides for: “ a review of the terms when prices of oil crosses $20 in real term; and a review of the terms 15 years after operation of the agreement and five years subsequently.”
However, NEITI said it observes with concern that Nigeria was yet to adhere to this important provision even now that the price of oil was revolving around $70 per barrel.
In an Occasional Paper released by NEITI which reviewed three years of NNPC’s financial and operations reports, NEITI has noted that crude oil production under the Production Sharing Contracts (PSCs) has since overtaken production under the Joint Venture arrangements.
A careful look shows that the Production Sharing Contracts (PSCs) accounted for 44.8 percent of total oil production while the Joint Ventures (JVs) contributed 31.35 percent.
A historical analysis of this development by NEITI shows that JV Companies accounted for over 97 percent of Production in 1998 while PSCs contributed only 0.50 percent.
This trend continued until 2012 when PSCs accounted for 37.58 percent while JVs contributed 36.91 percent.
From the publication in 2013, PSCs contributed 39.22 percent while JVs contributed 36.65 percent, 2014: PSCs; 40.10 percent and JVs 32.10 percent; 2015: PSCs 41.45 percent and JVs 31.99 percent while in 2017 the contributions stood at PSCs 44.32 percent and 30.85 percent respectively.
The NEITI Occasional Paper further explained that: “Other companies, comprising Nigerian Petroleum Development Company (NPDC), Alternative Financing (AF), and Independent/ Marginal Fields contributed 2.39 percent to total production in 1998 and by 2017 this had risen to 24.83 percent.
“This figure clearly shows the changing structure of oil production in Nigeria, where PSCs (which contributed a mere 0.5 percent to total production 20 years ago) have dramatically overtaken JVs (which contributed 97 percent to total production 20 years ago)”.
Between 2015 and 2017 covered by NEITI’s Occasional Paper review of NNPC Report, Nigeria produced 2.126 billion barrels of crude oil and condensate.
A Further review of the NNPC Report shows that: “Production was highest in 2015 with 775.6 million barrels produced. Production was lowest in 2016 with 661.1 million barrels produced, while production in 2017 was 690 million barrels.
“The year 2016 was a difficult year for oil production because production was shut in a number of oil terminals”.
NEITI said its major concern is that now that the PSCs account for about 50 percent of total oil production and major source of revenues, the delay or failure to review and renew the agreement means that payment of royalty on oil production under PSCs would not be made while computation of taxes would be based on the old rates.
On lifting of crude oil, the NNPC Monthly Financial and Operations Report disclosed “international oil companies (IOCs) lifted more crude oil than the government.
“Total lifting of crude oil and condensates was 2.135 billion barrels. Of this sum, IOCs and Independents lifted a total of 1.367 billion barrels, while government’s lifting by NNPC was 721.16 million barrels.
“This means that the operators lifted 64.01 percent of total crude lifting’s, while government through NNPC lifted 33.76 percent. When expressed in monetary terms, total government lifting of oil amounted to $35.893 billion while the figure for IOCs and Independents was $68.591 billion”
The NNPC Report further disclosed that refineries received 15.15 percent of total domestic crude lifting out of which 41.32 percent was utilized under the Direct Sale Direct Purchase (DSDP) program of NNPC.
On Refineries and domestic crude utilization, the report disclosed that for the 3 years under review, Nigeria’s refineries recorded an average capacity utilization of 12.26 percent.
A further breakdown shows that Kaduna refinery had the lowest capacity utilization of 9 percent while Warri and Port Harcourt recorded 9.73 percent and 15.4 percent respectively.
One striking feature of the NNPC financial operations report is the disclosure that the corporation lost the sum of N547 billion in its operation between 2015 and 2017.
Out of this amount, the NNPC Corporate Headquarters recorded the highest revenue loss to the tune of N336.268 billion.
On the contrary, the report revealed that the Nigeria Gas company made a huge profit of N141.324 billion.
NEITI said while it applauds the monthly voluntary disclosures by the NNPC, it was important to note that NEITI through its auditors under the EITI framework has not independently verified the information and data from the NNPC reports.
“NEITI has not, except for the year 2015, independently validated the data from NNPC. This will be done in ongoing and future reconciliation reports. What has been done here is a preliminary analysis of the data that NNPC has made available for the three-year period. The figures examined here do not represent the sum total of all revenues from the sector, as other payment streams like royalties and taxes from JVs, signature bonuses, transportation rental fees, NESS fees, penalties and others are not covered by the NNPC financial and operational reports” the NEITI Report concluded.
NEITI however commended the NNPC for the reconciliation of the crude swap under-delivery transaction executed during the crude- for- product- swap.
NEITI also urged the corporation to sustain the new spirit of openness while encouraging the citizens to use the information and data from the NNPC’s disclosures to promote public debate required in implementing the on-going reforms in the extractive sector.
The NEITI Occasional Paper series which reviewed the 3 years of NNPC operations and financial reports is the third in the series. In the pursuit of EITI global Open Data Policy, NEITI has data set for the three years (2015 -2017) in excel format readily available on its website in support of public interest, analysis and debate.
By Adedapo Adesanya
Nigeria attracted $10.37 billion in capital importation in the first quarter of 2026, representing an 83.8 per cent increase from the $5.64 billion recorded in the corresponding period of 2025, according to the National Bureau of Statistics (NBS).
The latest Capital Importation Report released by the stats bureau also showed that capital inflows rose by 60.97 per cent from $6.44 billion recorded in the fourth quarter of 2025.
The report stated, “In Q1 2026, total capital importation into Nigeria stood at $10.37bn, higher than $5.64bn recorded in Q1 2025, indicating an increase of 83.83 per cent. In comparison to the preceding quarter, capital importation increased by 60.97 per cent from $6.44bn in Q4 2025.”
Analysis of the inflows showed that portfolio investment remained the dominant source of foreign capital, accounting for $9.86 billion or 95.09 per cent of the total amount imported into the economy.
The stats office disclosed that foreign direct investment stood at $135.08 million, representing only 1.30 per cent of total capital inflows, while other investments accounted for $374.48 million or 3.61 per cent.
“Portfolio Investment ranked top with $9.86bn, accounting for 95.09 per cent, followed by Other Investment with $374.48m, accounting for 3.61 per cent. Foreign Direct Investment recorded the least with $135.08m, representing 1.30 per cent of total capital importation in Q1 2026,” the report added.
A further breakdown showed that money market instruments attracted the largest share of portfolio investments at $6.50 billion, while investments in bonds amounted to $3.23 billion.
Equity investments under the portfolio category stood at $131.81 million.
The banking sector emerged as the biggest destination for foreign capital during the quarter, attracting $7.55 billion, representing 72.79 per cent of total inflows.
The financing sector followed with $2.43 billion or 23.42 per cent, while the production and manufacturing sector attracted $152.27 million, accounting for 1.47 per cent of total capital imported.
Other sectors that received foreign investments included shares, trading, agriculture, information technology services, telecommunications, oil and gas, transport, construction, healthcare, education, and consultancy services.
The United Kingdom remained Nigeria’s largest source of foreign capital, accounting for $5.08 billion or 49.01 per cent of total inflows. The United States followed with $3.18 billion, representing 30.69 per cent, while South Africa accounted for $983.83 million or 9.49 per cent.
Among financial institutions, Standard Chartered Bank Nigeria Limited received the highest capital inflow during the quarter at $4.41 billion, representing 42.56 per cent of the total.
Stanbic IBTC Bank Plc followed with $2.78 billion or 26.79 per cent, while Rand Merchant Bank handled $930.82 million, accounting for 8.97 per cent.
Other banks that facilitated capital inflows into the country during the period included Citibank Nigeria, Access Bank, First Bank of Nigeria, Guaranty Trust Bank, Zenith Bank, FCMB, Ecobank, Fidelity Bank, and United Bank for Africa.
By Aduragbemi Omiyale
The 2026 licensing round for oil fields is expected to commence in the third quarter of 2026, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has disclosed.
This followed the approval of President Bola Tinubu, who doubles as the Minister of Petroleum Resources.
A statement issued by the spokesperson of NUPRC, Mr Eniola Akinkuotu, on Wednesday said the authorisation is in compliance with the Petroleum Industry Act (PIA).
“We are also fortunate that the President and Minister of Petroleum Resources has approved the 2026 Licensing Round,” the chief executive of the agency, Mrs Oritsemeyiwa Eyesa, was quoted as saying in the statement when she received representatives of Meren Energy (formerly Africa Oil) in Abuja yesterday.
Mrs Eyesan, who expressed satisfaction with the conduct of the 2025 Licensing Round so far, stated that the commercial bid would take place in July, after which the next licensing round would commence.
The NUPRC boss said the heightened participation in the 2025 Licensing Round was a testament to the fact that Nigeria was headed in the right direction.
She said the rise in investments, coupled with the upswing in production, was evidence that Nigeria’s oil and gas sector, under the leadership of President Bola Tinubu, had become attractive.
“We are in the process of finalising the 2026 launch, which will happen by the third quarter at the latest. So, this is the make-or-break point, and we want to make sure we make it,” she stated.
In his remarks, the chief executive of Meren Energy, Mr Oliver Quinn, said the current reforms had inspired the company to increase its investments in Nigeria, hence its interest in asset divestments and licensing rounds, revealing that his company’s investment priority is Africa, of which Nigeria ranks as number one.
“We have operated in Agbami, Akpo and Egina world-class fields. I think till date, in 20 years, about $11bn in capital from our side has gone into these assets, and about $4bn has gone to tax and royalties,” he said, adding, “Nigeria remains the core of our business today because of the quality of these assets.”
According to Mr Quinn, Meren Energy is pressuring its partners on these assets to deepen their investments and then increase overall production, noting that the energy firm was the first in Nigeria to sell crude oil to the Dangote refinery and will continue to fulfil its Domestic Crude Supply Obligation so long as the price remains right.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its gains by 0.91 per cent on Wednesday, June 3, spurred by three price gainers led by FrieslandCampina Wamco Nigeria Plc, which rose by N13.90 to sell N210.41 per share versus the previous day’s N196.51 per share. MRS Oil appreciated by N10 to N190.00 per unit from N180.00 per unit, and Food Concepts Plc added 5 Kobo to sell at N3.00 per share versus N2.95 per share.
As a result, the market capitalisation increased by N23.91 billion to N2.660 trillion from N2.636 trillion, and the NASD Unlisted Security Index (NSI) gained 39.97 points to finish at 4,446.27 points, in contrast to Tuesday’s 4,406.30 points.
The NASD exchange witnessed three price losers at midweek, led by Nipco Plc, which shrank by N21.30 to close at N325.97 per unit compared with the previous session’s N347.27 per unit, Nitrox Industrial Gases Plc went down by N1.20 to quote at N24.30 per share versus the preceding session’s N25.50 per share, and Central Securities Clearing System (CSCS) Plc weakened to by 69 Kobo to N75.41 per unit from N76.10 per unit.
The volume of trades yesterday significantly improved by 71.5 per cent to 527,221 units from Tuesday’s 307,363 units, as the value of transactions soared by 49.9 per cent to N64.2 million from the preceding session’s N49.9 million, and the number of deals surged by 9.5 per cent to 46 deals from 42 deals.
When trading activities ended for the day, Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units worth N6.5 billion, and CSCS Plc with 64.6 million units exchanged for N4.4 billion.
GNI Plc also ended the session as the most traded stock by volume on a year-to-date basis with 3.4 billion units sold for N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
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