The sum is the estimate of what the attorney general of the federation, Abubakar Malami, believes the country should have received, from a review of the revenue sharing formula in the Production Sharing Contracts signed with the firms in the 1990s.

Former governor of Bayelsa State, Timipre Sylva

Nigeria’s minister of state for petroleum resources, Timipre Sylva,
said on Wednesday that the country had lost the opportunity to claim
N18.91 trillion — $62 billion from international oil companies.

The sum is the estimate of what the attorney general of the
federation, Abubakar Malami, believes the country should have
received, from a review of the revenue sharing formula in the
Production Sharing Contracts signed with the firms in the 1990s.

According to Reuters, Sylva disclosed this to newsmen after the
Federal Executive Council meeting in Abuja.

“Nobody can bring out that kind of money,” Sylva said. “I mean, we
can’t get $62 billion. We can maybe get something from them but not
$62 billion. It’s an opportunity we have lost.”

Five oil companies – Shell, Chevron, ExxonMobil, Eni, and Total, have
so far been approached individually to make remittances on a backdated
attempt by the government to review the PSC.

One of the five firms told Reuters they had received a bill of close
to $10 million.

“We have to ensure that this bill is passed. With this bill now, there
will be some adjustments in the fiscal regime and we believe that the
government will get a lot from the oil companies, especially their
deep shore exploration activities,” Sylva added.

The companies had earlier told the news agency that they do not agree
with the government’s demands, they have since made representations in
court. Section 16 of the act provides for the contract terms to be
reviewed once the dollar crosses $20, after 15 years and every five
years subsequently.

On Tuesday, the Senate adopted a report by the joint committees on
petroleum upstream, gas and finance, seeking to amend the PSC.

The details of the amendments made are sketchy at this time.

According to a 2018 executive bill sent to the 8th assembly, the
executive requested that section 16 of the act be amended with the
introduction of a third section that will make the government get more
from royalties as oil prices increase.

Royalty rates are fixed percentages at the moment, with petroleum
sourced at depths deeper than 1000m paying 0 percent.

Based on debates held during the passage of the PSC amendment on
Tuesday, the period of review after the initial 16 years, which
elapsed in 2008, was increased from five to eight years.

The executive hoped to earn at list N320 billion with the passage of
the bill in 2018 to fund the 2019 budget.

President Muhammadu Buhari now hopes the country will make $500
million – N152.5 billion in 2020 and $1 billion – N305 billion in 2121
if the revision of the law sales through.