Malami demands US62.1b debt from oil companies
The Minister of Justice and Attorney General of the Federation (AGF), Abubakar Malami has asked international oil companies (IOCs) to settle their unpaid arrears estimated at $62.1billion.
Malami said, since the signing of the Deep Offshore and Inland Basin Production Sharing Contracts Act CAP D3 Law of the Federation of Nigeria 2004 (as amended) 2019 for oil exploration in deep offshore and inland basis, the Federal Government was to get more shares of the oil revenue, which the IOCs did not pay.
He said the arrears of what the IOCs were yet to remit to the Federal Government was estimated, as at 2018, at $62,190,679,793.
In a statement Tuesday by his spokesman, Umar Jibrilu Gwandu, Malami said the matter was not about percentage to be given to the recovery agency, but of patriotic desire to get back to the country the revenue it deserves noting that the 5% was a reduction from what it used to be during the past administration.
Part of the statement reads: “The minister noted that the 5% propose success contingent fees was an unprecedented reduction from what it used to be.
“The 5% as a recovery fee is a product of innovation introduced by the Federal Government upon the assumption of office of the President Muhammadu Buhari as against 30% and above which was the traditional fee by the previous administration.
“The comparative basis is not the Lagos budget as the considerable parameter, but the amount due for the recovery which in the circumstance is approximately $62, 190, 679,793.00 as at December 2018.
“When you convert $62, 190,679, 793 billion dollars into naira it will give you an amount more than 20 trillion naira.
“By virtue of Section 162 of the Constitution of the Federal Republic of Nigeria 1999 as amended, the amount in question is more than enough for three year budget of the most populated African country; Federal Republic of Nigeria considering the 2020 budget of 10.3 trillion naira.”
Gwnadu added that Malami said it was not about the composition and who the recovery agents are, but the funds belonging to the Nigerian masses must be recovered for the government to carry out more development projects for the benefits of the teaming populace who brought the government into power and whose interest the Federal government stands firms to protect.
“Above all, volume of the fees payable to the recovery agents which in all cases is contingence upon recovery of has never been a subject of executive contention in this matter”.
“It does not accord with reason and logic for the Federal Government of Nigeria to overlook, forgo and condone loss of $64bn on account of meager 5% fee payable upon recovery.
Gwnadu recalled that three oil producing states of Bayelsa, Rivers and Cross River filed an action in the Supreme Court on 27th April, 2019 praying, among other things that “recover and pay immediately all outstanding statutory allocations due and payable to the plaintiffs”.
On 19th January, 2018, Trobell International (Nig) Ltd forwarded proposal to the Office of the Attorney-General of the Federation requesting to be engaged as an agent to recover diverted proceeds of the Governments of Nigeria due from the share of profit oil under the various Production Sharing Contracts made pursuant to sharing contract made pursuant to Section 16(1) of the Deep Offshore and Inland Basin Production Sharing Contracts Act CAP D3 Law of the Federation of Nigeria 2004.
Following the approval for Trobell International (Nig) Ltd to undertake the task on April 12th 2018, the company engaged the services of lawyers, engineers, financial experts and petroleum experts nominated by the three state governments.