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Oil companies operating in Nigeria have no Certificate of Acceptance on fixed assets -Reps C’ttee

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JONAS EZIEKE, Abuja 

 

An Ad-hoc Committee of the House of Representatives investigating all the Joint Venture (JV) businesses and Production Sharing Contracts (PSCs) of the Nigerian National Petroleum Company Limited has said that all these major oil companies in Nigeria are operating without Certificate of Acceptance on Fixed Assets (CAFA).issued by the federal authorities.

 

The House Committee said that all of the oil companies have operated without the CAFA certificate issued by the Ministry of Trade and Investment to legalize their operations.

 

The lawmakers said that CAFA is issued to evidence an approval from IID for the purchase of assets valued at ₦500,000 and above, while a capital allowance is granted to companies that have incurred qualifying capital expenditure for a trade or business to generate taxable.

 

The committee further stated that most of them were making claims of capital allowance from the government without the certificate and as such may be compelled to make a necessary refund to the government coffers.

 

Chairman of the Committee, Hon. Abubakar Fulata disclosed on Tuesday at the resumed investigative public hearing of the committee in Abuja.

 

The committee also indicted Shell BP, Chevron, AGIP, Total oil companies amongst others, saying they committed malfeasance amounting to billions of dollars.

 

Fulata who reeled out the names of the affected oil companies at the hearing said that they must appear before the committee to clear the allegations.

 

He said that tax evasion by the oil companies was central to the committee’s investigation which covered thirty-two years, precisely from 1990 to date.

 

He stressed that the companies were withholding information from the committee.

 

He said: “Let me make it very clear that the issue of tax evasion is at the core of this investigation. We have given you ample time to respond but most of the companies deliberately withheld information.

 

“All companies in Nigeria do not have the CAFA certificates and they are enjoying capital allowance amounting to millions of dollars. Things they can’t do in their country they are doing in Nigeria. Unless you clear the malfeasance of this allowance, the committee would be compelled by the relevant agency to recover this money.

 

“I will like to urge the stakeholders in this investigation to appear as a matter of necessity to defend themselves against flagrant violation of Nigeria’s tax laws. For example, Total is to appear with evidence to defend itself against the malfeasance of $5.3 billion, in respect of OML 130. Total also appears to defend itself against the malfeasance of $7.3 billion in respect of OML 130 PSC.

 

“The first one is Total Upstream Limited, the second one is Total Upstream Nigeria Limited. Number three, Addax Petroleum is expected to appear before this committee to defend itself against the malfeasance of $2.8 billion in respect of OML 123 and 124 PSC. In addition, Total is requested also to appear to defend itself against allegations of $11.2 billion in respect of OML 138.

 

Again, Star deep (Chevron) is to defend itself against $14.9 billion in respect of OML 127 and then, SO Exploration and Production are to appear and defend itself against the malfeasance of $6.6 billion in respect of OML 133 and Star Oil Nigeria Limited are expected to appear and defend itself against the malfeasance of $3.28 billion. Then AGIP Energy and Natural Resources Limited are expected to defend itself against the malfeasance of $62 million in respect of OML 116, Plc. Nigeria AGIP again is expected to appear and defend itself against the malfeasance of $1.595 billion in respect of OML 125 and 134. Then, Shell Nigeria Exploration and Production company is expected to appear before this committee and defend itself against the malfeasance of $7.557 billion. Addas Petroleum is expected to appear to defend itself against allegations of malfeasance amounting to $1.29 billion.

 

“In addition, Shell is expected to come and defend itself against the malfeasance of $2.2, 572, 818,633 billion. Chevron is invited to defend itself against the malfeasance of $14, 674, 269,399 billion. Total, again, is expected to present itself and defend the malfeasance of $1.385,302,139 billion. Then, Amin International is asked to appear before this committee and defend itself against the malfeasance of $302,159,600 million.

 

“Now, Star Deep Exploration and Production Limited is asked to appear to defend itself against the malfeasance of $1.497 billion in respect of OML 143. And then, Addas, again, appeared to defend itself against the malfeasance of $3, 288, 233. 83 billion.

 

“These are just a few because the data is not yet completed. This is just the tip of the iceberg in terms of the malfeasance perpetrated by oil companies in Nigeria.”

 

The committee also directed the Clerk of the committee to invite the Registrar General of the Corporate Affairs Commission (CAC), Alhaji Garba Abubakar to the next sitting to answer to some concerns of the lawmakers.

 

“Clerk, write to invite the chief executive of the Corporate Affairs Commission at the next hearing”, Fulata said.

 

Earlier, the Committee grilled the Managing Director of Seplat Energy, Ayo Olatunde on a wide range of issues which included the number of oil blocs it operated and for how long; the amount of money paid for the acquisition of OMLS and from whom it was paid to; joint venture partnership with NNPC or NPDC; the basis for which the company received cash call of 5 million dollars from the federation in 2017; the contribution of cash call as a counterpart funding and what was received as a capital allowance from the inception of the company’s engagement till date.

 

To conclude the day’s hearing, the panel, asked the company to provide it with the details of its payments, the amount paid, the banks, account numbers, and statements.

 

The oil firm was also asked to make details of “all the jobs you have awarded from 2010 till date. We want to see the due process you followed”.

 

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