Nigeria Loses $37bn Investments to Non-passage of PIBhttp://www.thisdaylive.com/articles/nigeria-loses-37bn-investments-to-non-passage-of-pib/146955/ Nigeria has lost $37billion in private sector investments in the oil and gas industry in the last five years due to the non-passage of the Petroleum Industry Bill (PIB), which resulted in industry stagnation between 2008 and 2012, according to a data released by Wood Mackenzie.
The report indicated that in 2012 there was a gap of $7billion between planned investments in the oil and gas industry and the actual investments.
According to the report, capital expenditure and operational expenditure of $37billion was lost due to the industry stagnation, which also created vicious cycle in federal government's revenues.
The report noted that the country also experienced fiscal crisis, which was however masked by high prices of crude oil.
In the 2012 budget, there was a shortfall of $10billion and over $50billion shortfall in the 2007-2012 industry plan, according to the report.
The report listed reduced investments, reduced crude oil production, reduced government revenues, increased debt and increased borrowings as some of the effects of the non-passage of the PIB.
With stagnation in both reserves and production, the country lost 100,000barrels per day in 2008; 800,000barrels per day in 2009; 500,000 barrels per day in 2010; 600,000bpd in 2011 and 1.5million bpd in 2012, said the report.
The federal government actually lost an estimated $100billion in revenue between 2007 and 2012 from inability to meet crude oil production targets, according to a separate data sourced from the National Petroleum Investment and Management Services (NAPIMS), the investment arm of the Nigerian National Petroleum Corporation (NNPC).
The fall in government revenue was blamed on militant attacks on oil workers and facilities before the amnesty programme; crude oil theft and lack of investment by the operators arising from the non-passage of the PIB.
The data reveals that except in 2007 when the federal government achieved its projected target of 2million barrels per day at crude oil price of $74.48 per barrel, projections from 2008 to 2012 were not actualised, resulting to loss of $100billion in revenue, according to the prevailing international market price of crude oil.
The NNPC recently admitted that the daily crude oil production in the first quarter of 2013 fluctuated between 2.1 and 2.3 million barrels per day (mbpd) compared with the projected estimate of 2.48million bpd in the 2013 budget.
This shortfall between actual production and forecast in first quarter 2013 resulted in a drop in crude oil revenue of about $1.23 billion, or N191billion that should have accrued to the Federation Account