Audio By Carbonatix
Africa’s top oil producer plans to make gas flaring more costly for companies that have escaped the payment of billions of dollars despite being fined, Nigerian Finance Minister Kemi Adeosun said.
In the “legal framework for the gas-flaring penalty, it was drafted as a charge. A charge is tax deductible,” Adeosun said in a Jan. 23 interview. “So, what do the international oil companies do? They flare, they pay the charge on which they get tax relief. That’s just bad drafting.”
The government is approaching lawmakers to amend the law and have the word ‘penalty’ replace ‘charge,’ the minister said in her office in the capital, Abuja. “Just that one word has potentially cost us billions of dollars.”
Oil companies flare natural gas that is produced along with crude instead of harnessing it because that can be costly or difficult for security reasons. Nigeria has sought to limit the practice over the years as it pollutes the environment and contributes to global warming.
Seeking Revenue
The West African nation is recovering from a contraction of its economy in 2016, the first in 25 years, and is seeking revenue sources to plug a $25 billion infrastructure gap and fund a record 2018 budget presented in December by President Muhammadu Buhari.
The government is also updating the tax law and going after defaulters, with the intention to boost collection and raise the country’s tax-to-GDP ratio, currently at 6 percent and among the lowest in the world.
Nigeria in the past never focused much on tax revenue because of its reliance on oil income that funds most of government spending, Adeosun said. The OPEC member produced 1.8 million barrels per day in December, according to data compiled by Bloomberg.
Latest Stories
-
Charles Amissah death should trigger reforms in Ghana’s healthcare system – GRNMA
17 minutes -
Ghana’s FMCG sector grew by 15% in value in quarter one 2026, but recovery is patchier – Maverick Research
48 minutes -
MPs express disappointment in Amandi Construction over Western Rail Project delays
1 hour -
Understanding the National Determined Contributions and National Adaptation Plans and their implications for the private sector
2 hours -
ETI to raise funds from international debt market
2 hours -
Thirty years, one road, and a minister who stopped to listen
2 hours -
Energy Minister John Jinapor to inspect power projects in Kumasi Tomorrow
2 hours -
White House Press Secretary Karoline Leavitt announces birth of baby girl
2 hours -
Asare replaces Dreams FC’s Aseako for Mexico friendly
2 hours -
IGP’s Cyber Vetting and Enforcement Team arrests 11 for impersonating President Mahama
2 hours -
Charles Amissah death probe: GRNMA objects to naming of health professionals, cites mental health concerns
2 hours -
BoG pushes cross-border instant payments to drive Africa’s economic integration
2 hours -
Rwandan singer dies as he was being released from prison
2 hours -
MoH sets up technical committee to resolve KBTH laboratory dispute
2 hours -
Over 5,000 unemployed agricultural graduates push government for recruitment
2 hours