• Monday, July 22, 2024
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BusinessDay

Reps to engage OICs over N1trn cash call on oil joint venture

House-of-Rep

The House of Representatives on Wednesday unveiled plans to engage the Nigerian National Petroleum Corporation (NNPC) and oil majors involved in the joint venture (JV) with a view to reviewing the annual N1 trillion production cost.

The move was part of efforts geared toward restructuring the N6.08 trillion Appropriation Bill presented by President Muhammadu Buhari to the joint session of the National Assembly.

President Buhari had during the formal presentation of the N6.08 trillion budget proposal to the joint session of the National Assembly, emphasised the need to fund the N2.2 trillion budget deficit through external and domestic borrowings.

Abdulmumin Jibrin, chairman House Committee on Appropriations, who spoke with Legislative Correspondents in Abuja, also confirmed that the $3.5 billion World Bank/African Development Bank facility being sourced by the Federal Government was part of the 2016-2018 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) approved by the National Assembly.

“One very important aspect that swallows a large chunk of the money in the budget is the cash call and production costs. Many people take their eyes away from production costs, but it is critical because every year, we pay an average of N1 trillion as cost of production.

“So, it is important that this time around, we have to sit with relevant authorities in the oil and gas sector to see the details of this production cost, to ensure the country is not just being shortchanged and we are just mopping a lot of money from the first line charge just to give to our foreign partners,” Jibrin stated.

Jibrin assured that the House of Representatives would engage respective agencies involved in National Planning, Budget and Finance on some key issues relating to the budget proposal as from 11th February 2016, considering the need to redirect the budget to agriculture and solid minerals sectors in tandem with the diversification policy.