EFCC Recovers N115bn NDDC Levy from Oil Firms in Nigeria

• The EFCC recovered over N115 billion and $84 million in outstanding statutory levies owed the NDDC by oil companies.
• The recovery efforts were prompted after reviewing the NEITI audit report, which raised queries about outstanding liabilities arising from the three per cent statutory levy payable to the NDDC.
• A substantial portion of the recovered funds remains in the commission's recovery account, totaling N3.51 billion and $14.01 million.

The EFCC focused on one primary pillar identified in the NEITI report, i.e., unpaid three per cent statutory levies due to NDDC, but we did not lose sight of the fact that there could be other unpaid statutory obligations and taxes due to the Federal Government.

The Economic and Financial Crimes Commission's (EFCC) recovery of over N115 billion and $84 million in outstanding statutory levies owed the Niger Delta Development Commission (NDDC) by oil companies has added a significant financial dimension to the Senate's examination of revenue shortfalls and unresolved liabilities identified in the Nigeria Extractive Industries Transparency Initiative (NEITI) audit report. The EFCC's intervention prompted some oil companies to settle their obligations directly with the NDDC, resulting in payments of N6.71 billion and $16.99 million. However, a substantial portion of the recovered funds remains in the commission's recovery account, totaling N3.51 billion and $14.01 million.

The EFCC focused primarily on the unpaid three per cent statutory levy due to the NDDC, as identified in the NEITI audit report. This decision was made after reviewing the 2021-2023 NEITI Oil and Gas Industry Audit Report, which raised queries about outstanding liabilities arising from the statutory levy payable to the NDDC. The commission's investigation involved 43 oil companies, out of which 24 operating in the Niger Delta region were found to have outstanding liabilities totaling N76.88 billion and $81.08 million.

The recovery of these funds has significant implications for revenue leakages and reputational damage in the oil and gas sector. The unpaid statutory levies owed to the NDDC are part of a larger issue of non-compliance with financial obligations by oil companies operating in Nigeria. This lack of compliance not only affects the development of the Niger Delta region but also contributes to revenue shortfalls and reputational damage for the companies involved.

Lawyers advising oil companies operating in Nigeria should be aware of the potential compliance exposure arising from unpaid statutory levies owed to the Niger Delta Development Commission, which could lead to revenue leakages and reputational damage.

Source: Original reporting via EFCC