EXTRACTIVE TRANSPARENCY NAP 2

COMMITMENT 4: Extractive Transparency

Public disclosure of extractive sector contracts, licenses, permits, payment to government and revenue stream to improve transparency, fiscal terms and positively impact public finances. Lead MDA: NNPC, Ministry of Petroleum Resources and Ministry of Mines & Steels Responsible person(s): GMD/ES, Minister of Petroleum, Minister of Mines & Steel There have been commendable efforts in the extractive sector to enhance transparency and accountability. For instance, the National Oil Company, NNPC, has published monthly operational and financial statements since 2015, engaged with CSOs and citizens’ groups and openly broadcasted bid opening rounds for new licenses. NNPC has also committed and actively participated in the global processes including the OECD and the Extractives Industries Transparency Initiative (EITI) Commodity working group, working towards bringing further transparency to commodity trading by States Owned Enterprises globally.  The Ministry of Mines and Steel launched the ‘Road Map for the Growth and Development of the Nigerian Mining Industry’ in September 2016 which identified some initiatives within the short, medium and long-term timeline which the Ministry can undertake to better position Nigeria’s mining sector. Despite these efforts, the extractive sector still has not fully delivered on developing and improving the well-being of the vast majority of citizens.  The pace of reform has been slow and there is still widespread opacity in the industry which has allowed corruption to thrive. In the case of the oil and gas sector, deepening issues of underassessment, underpayment and under-remittance/non-remittance of revenues due to government have limited what the government can deliver to improve the lives of citizens. A backlog of remedial actions especially as identified by NEITI audit reports, to improve accountability across financial, processes and production has not been prioritized or implementation has been too slow leading to further leakage and loss in citizens’ confidence.   A first step towards achieving transparent, broad-based and effective citizens’ participation in the extractive sector is to publish contracts which are the fundamental documents that set out the terms of all investments and projects in the sector. Contract disclosure in the oil, gas and mining sector is increasingly a global norm with progress by governments, international financial institutions and the EITI making bold steps to disclose or require public disclosure. The Government of Nigeria has made several commitments to publish petroleum contracts including at the 2016 UK Anti-Corruption Summit where the President committed to working towards full implementation of the Open Contracting Standard, and the 7 Big Win’s that commits to publishing all established fiscal rules and contracts within two to four years. A growing number of companies with operations in Nigeria also have expressed support for contract disclosure, the majority of these companies have noted, however, that in their view the decision to publish contracts must be initiated and implemented by the government. Transparency and accountability remain the basis of a sound corporate governance regime.  The OECD’s position is that information disclosure and higher standards of accountability in SOEs, coupled with other governance reforms can contribute to improved efficiency and performance of SOEs. Best practice and global standards demand that information disclosure including both financial and non-financial data is essential for the government, so it can be an effective owner; oversight from the National Assembly; the media to raise awareness on SOE efficiency; and taxpayers and the general public to have a comprehensive picture or SOE performance. Transparency, driven by enhanced disclosures, constitutes a major component of an SOE’s accountability to shareholders, potential investors and business partners, and an increasingly engaged civil society. The details of implementation of specific activities are as follows:

Milestone 30: Identify and publicly disseminate mechanisms, platforms and frameworks for disclosure of contracts and putting them to use – NEITI

Start-Finish Date: October 2019 to March 2020

Status: 

Last Updated: October 2019


Milestone 31: Identify, create and update a free online portal for disclosure of contracts, licenses and permits (Public Registers) of the extractive sector

Start-Finish Date: October 2019 to March 2020

Status:

Last Updated: October 2019


Milestone 32: Disclose contracts in a free online portal, accessible in both human and machine-readable formats. The portal should contain the full texts of all agreements, together with any subsequent amendments, annexes, schedules, side letters or similar documents. 

Start-Finish Date: March 2020 to March 2021

Status:

Last Updated: October 2019


Milestone 33: Quarterly disclosure of actual unit production cost for crude oil, gas and refined product sales – DPR/NNPC COMD.

Start-Finish Date: October 2019 to June 2020

Status:

Last Updated: October 2019


Milestone 34: Timely public disclosure by NNPC of the annual report and audited financials

Start-Finish Date: October 2019 to July 2021

Status:

Last Updated: October 2019

COMMITMENT 5: 

Work together with all stakeholders to enhance transparency in the extractive sector through a concrete set of disclosures related to payments by companies and receipts by governments on all transactions across the sector’s value chain. Lead MDA: Nigeria Extractive Industries Transparency Initiative (NEITI) Responsible person(s): Dr. Orji Ogbonnaya Orji [Director, Communications] The EITI process in Nigeria collects and publishes information about Nigeria’s extractive industry and disbursement of revenue. The annual Oil and Gas Audit, Solid Minerals Audit and Fiscal Allocation and Statutory Disbursement Audit provide data and information about the management and utilization of extractive revenue. The audit makes various recommendation and identifies those responsible for implementing remediation. To ensure that citizens benefits from the utilization of revenue derived from the sector, there has to be mechanism to engage various segment of the public to hold government accountable and engage them in informed debate. Empowering the citizens with information from the audit will help them know how much government receives from the sector, how it is distributed and allocated; and empower them to demand better utilization for improved service delivery and sustainable development. The EITI standards is a tool for continuous improvement of audit and monitoring the extractive sector, provision of data and information; and engagement of stakeholders. The details of implementation of specific activities are as follows:

Milestone 35: Quarterly status/progress update on identified remedial issues by covered entities responsible for remediation

Start-Finish Date: December 2019 to To be Published

Status:

Last Updated: October 2019

Other Details:


Milestone 36: Identify and prioritize key reoccurring remedial issues in NEITI Oil and gas, mining report

Start-Finish Date: November 2019 to March 2020

Status:

Last Updated: October 2019


Milestone 37: Produce audit reports in an accessible format that ensures inclusion of women, youths and vulnerable groups in advocacy of issues raised.

Start-Finish Date: December 2019 to July 2021

Status:

Last Updated: October 2019


Milestone 38: Develop framework for good practices on ensuring full participation of women in the extractives sector

Start-Finish Date: October 2019 to March 2020

Status:

Last Updated: October 2019


Milestone 39: Data disclosure by companies on employment statistics disaggregated by gender.

Start-Finish Date: TBA (following consultation NCDMB) to TBA (following consultation NCDMB)

Status:

Last Updated: October 2019

Other Details:


Milestone 40: Publish a publicly available beneficial ownership register of companies in the oil, gas and mining gas sector

Start-Finish Date: October 2019 to February 2020

Status:

Last Updated: October 2019

Other Details:

LEAVE A REPLY

Please enter your comment!
Please enter your name here