NEITI cautions against indiscriminate award of oil prospecting licences

THE Nigeria Extractive Industries Transparency Initiative (NEITI) has called for transparency in the acquisition and awards of oil prospecting licences and mining leases.

The Executive Secretary of NEITI, Mrs. Zainab Ahmed, made the call at the appraisal workshop for awardees of oil prospecting licenses organised by the Directorate of Petroleum Resources (DPR).

Represented by the team leader, Outreach, Mrs. Obiageli Onuorah, she noted that the absence of transparency in the acquisition and awards of oil prospecting licenses, mining leases, financing mechanisms, inappropriate disclosures of oil and gas production figures and revenues had characterised Nigeria’s extractive sector.

 

The NEITI scribe urged the management of the DPR to place all licences and contracts in the public domain in conformity with global standards.

Her words: “As you may be aware, during the recently concluded global conference of EITI in Australia, the global body formulated new standards. Publishing contracts helps citizens evaluate which benefits and protections their country receive in exchange for access to publicly owned natural resources.”

Ahmed added that contract transparency also helped citizens monitor whether companies and government lived up to their obligations as contained in the agreements. She explained that making bidding processes transparent and competitive would ensure that the right people with the requisite expertise get the operational licences. 

The NEITI Executive Secretary underscored the importance of adherence to due process, transparency and accountability in the management of extractive resource wealth, which she said had become a global order.

Citing various global initiatives in this direction, Ahmed pointed out that there was a coordinated international response against corruption and impunity in the management of revenues accruing from the extractive sector.

She reiterated the need for the installation of dependable metering infrastructure to guarantee accurate measurement of crude produced at extraction and distribution points as was done in other oil producing countries of the world. This, she said would guarantee accurate reporting of Nigeria’s crude production levels and earnings or losses from the sector.

She commended the DPR director for putting together the workshop and enjoined him and his team to continue to cooperate with NEITI in its efforts to institutionalise and enthrone a regime of due process, transparency and accountability in the nation’s oil and gas sector.

Director, DPR, George Osahon identified funding, lack of data, capacity issues, uncertainty and insecurity as some of the challenges hindering the development of the acreages and investments in the sector.

By Collins Olayinka, September 10, 2013