The Nigeria Extractive Industries Transparency Initiative (NEITI) has announced plans to assess the divestment of 26 oil blocks, collectively valued at $6.03 billion, by five International Oil Companies (IOCs).
During the first-quarter media briefing in Abuja, c, highlighted significant transactions, including Shell’s $2.4 billion sale to Renaissance, ExxonMobil’s $1.28 billion deal with Seplat, and TotalEnergies’ $860 million transfer to Chappal.
Dr. Orji emphasized that these divestments are reshaping Nigeria’s oil and gas sector, underscoring the necessity for due process. He stated that NEITI will enhance collaborations with the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian National Petroleum Company Limited (NNPC Ltd.) to ensure comprehensive disclosure of the financial, social, and environmental dimensions of these transactions.
“NEITI recognizes the urgent need for transparency in these transactions to protect national interests, host communities, and revenue flows,” he remarked. To address this, NEITI plans to incorporate dedicated sections on divestments in its industry reports and work closely with NNPC Ltd. and other government bodies to disclose forward sales data. Additionally, NEITI aims to raise public awareness and involvement in asset transfers, ensuring transparency in forward sales (pre-sales of crude oil and gas) to positively impact government revenues and fiscal stability.
Dr. Orji also expressed concerns about unresolved environmental issues in oil-producing regions, noting that some divestments may not have adequately addressed these challenges. He called for joint efforts with regulatory agencies like NUPRC and the Ministry of Environment to enforce accountability for environmental remediation and associated costs.
In response to complaints about insufficient crude oil supply to local refineries, NEITI intends to review the government’s forward sales of Nigeria’s crude oil used as collateral for loans. Dr. Orji revealed that since NEITI began auditing the sector 23 years ago, Nigeria has generated $831 billion from oil and gas. He also noted that over $4.85 billion has been recovered following disclosures of $8.26 billion in NEITI’s 2021 oil and gas report.
“As we commence the 2024 Oil, Gas, and Solid Minerals Reports, we will expand our reporting framework to address: Forward sales and pre-export financing transactions,” he added. Dr. Orji acknowledged progress in promoting transparency within the oil, gas, and solid minerals sectors but highlighted ongoing challenges related to institutional constraints and funding limitations.
