Nigeria’s fuel subsidy bill reached N1.16 trillion in 2021, while another N1.20 trillion was deducted from crude oil sales proceeds during the year, according to the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC).
The figures were presented by RMAFC Chairman, Dr Mohammed Bello Shehu, before the Senate Public Accounts Committee (SPAC) during its investigation of Nigeria’s oil and gas revenue management between 2021 and 2023.
The committee, chaired by Senator Ibrahim Dankwambo (Gombe North), is examining audit reports on the sector produced by the Nigeria Extractive Industries Transparency Initiative (NEITI).
Shehu told the lawmakers that several other deductions were made from crude oil revenues during the period. These included N16.20 billion for crude and petroleum product losses, N22.05 billion for pipeline repairs and N6.75 billion for strategic stock holding.
He also questioned the methodology used to calculate Nigeria’s 13 per cent derivation revenue, arguing that deductions made before applying the derivation formula reduced the amount available to benefiting states.
According to him, calculating the derivation share from revenue remaining after deductions from total collections does not align with the purpose of the derivation principle.
“The practice of computing 13 per cent derivation on the balance of revenue after deductions from the total collections is contrary to the intention of the derivation objective,” he said.
The presentation came as the Senate panel continued its examination of how petroleum revenues were collected, deducted and remitted during the period covered by the investigation.
In a separate development, the committee deferred consideration of the submission made by the Niger Delta Development Commission (NDDC).
The panel directed the commission to return next Wednesday, giving members time to review its report before resuming consideration.
The committee also criticised the Auditor-General of the Federation for failing to attend the investigative session.
Dankwambo said the Auditor-General had no sufficient reason to stay away from the proceedings without either appearing personally or sending an authorised representative.
He subsequently directed the Auditor-General to appear before the committee next Tuesday, warning that failure to do so could result in the National Assembly using its constitutional powers to compel his attendance.
“The Auditor-General must unfailingly appear before this committee on Tuesday next week or risk invocation of the powers of the National Assembly against him, which will lead to forced appearance,” Dankwambo said.
The Senate investigation is focused on the findings contained in the 2021–2023 audit reports on Nigeria’s oil and gas industry conducted by NEITI, including the management of petroleum revenues and deductions made before remittances to government.