(EnergyAsia, August 26 2013, Monday) — Nigeria’s state revenue for July plunged 42% to 498 billion naira from the previous month due largely to theft and losses in crude oil flows that feed over 80% of the government’s budget. (US$1=161 naira).
The losses could mount and become permanent if the government proceeds to pass a controversial bill raising taxes on oil revenues, said the Oil Producers Trade Section (OPTS) comprising mostly the Western majors which account for the bulk of the country’s production.
The latest monthly audit adds to growing worries over Nigeria’s oil and gas industry which was found to have lost a total of US$10.9 billion in revenues from oil theft and infrastructure sabotage between 2009 and 2011.
Briefing reporters in Abuja last week, Minister of State for Finance Alhaji Yerima Ngama said a sharp drop in oil revenues caused state revenue to plunge from 863 billion naira in June to 498 billion naira in July.
Relations between the government and the majors comprising Shell, Exxon Mobil, Chevron, ENI and Total have been spiralling downwards as they accuse each other of causing the deterioration in Nigeria’s oil and gas industry.
Speaking on the OPTS, Mark Ward, head of Exxon Mobil Corp operations in Nigeria said the country’s oil production could fall by a quarter from around 2.4 million b/d today if the government passes the controversial Petroleum Industry Bill into law.
The OPTS, which accounts for 90% of the country’s oil production in joint ventures with state Nigerian National Petroleum Corp (NNPC), said its members would hold back investment and might even pull out of some existing projects, he said.
Local media reports suggest that Chevron and Shell have followed UK’s BG in pulling out of the Olokola liquefied natural gas (OKLNG) project located between the states of Ogun and Ondo. Chevron and Shell each held a 19.5% share in the project while BG pulled out its 14.25% in 2009, leaving main shareholder NNPC holding the rest.