Overview of Extractive Industries in Nigeria

Nigeria is the largest oil producer in Africa and among the top ten globally. Its recoverable reserves were estimated at 34 billion barrels in 2003. In recent years, the oil sector has accounted for about half of GDP, more than 95 percent of export receipts, and over 80 percent of government revenue. The sector is dominated by joint venture operations between the Nigerian government and six major international oil companies—Shell, Mobil, Chevron, Agip, Elf, and Texaco. Nigeria’s reserves of natural gas—an estimated 159 trillion cubic feet of proven reserves—are among the ten largest in the world, but gas production is less significant economically.

Status of EITI Implementation

Nigeria was accepted as an EITI candidate country on 27 September 2007. 

Nigeria Ghana has until 9 March 2010 to undertake validation.

A first set of financial, physical and process audits for the period 1999-2004 undertaken by a consortium led by the London-based Hart Group was published in 2006. The audits identified several weaknesses related to the management of oil revenues and oil and gas sector governance more broadly. Following the release of the audits, an Inter-Ministerial Task Team (IMTT) was asked to put together a comprehensive remediation action plan which was subsequently approved for implementation by the Nigerian government.

The remediation action plan covers five key areas: developing a revenue-flow interface among government agencies; improving Nigeria’s oil and gas metering infrastructure; developing a uniform approach to cost determination; building human and physical capacities of critical government agencies; and improving overall governance of the oil and gas sector.

The NEITI Secretariat has undertaken a number of activities to deepen awareness about the implementation of NEITI and to build capacity within government and civil society. The activities undertaken included several road shows, revenue management training for government agencies, as well as training workshops for civil society and the media.

Looking ahead, the NEITI Secretariat is in the process of expanding its outreach and awareness raising activities. Three Public Information Centers are expected to open shortly and more capacity building activities for media, civil society, and the legislature are being planned. A regional conference aimed at sharing experiences among EITI implementing countries in West Africa is being considered.

Efforts are ongoing to make progress in the five key areas identified in the remediation action plan. Annual audits—which are now mandatory under the NEITI Act—are continuing. The results of the 2005 and 2006 audits are expected soon. Lastly, Nigeria will soon start the EITI validation process.

Governance of EITI Implementation in Nigeria

Former President Olusegun Obasanjo committed to EITI in November 2003 and launched Nigeria EITI (NEITI) in February 2004. To give legal backing to the work of NEITI, a bill was introduced to the National Assembly in December 2004. This NEITI Act was finally passed into law by former President Obasanjo on May 28, 2007. With this, Nigeria became the first EITI-implementing country with a statutory backing for implementing EITI.

The governing body of NEITI is the National Stakeholders Working Group (NSWG) was appointed by the President Umaru Musa Yar ‘Adua on 29 January 2008.  The NSWG is chaired by Professor Humphrey Asobie and comprises representatives from civil society, government, and extractive industry companies. The day-to-day work is carried out by a NEITI Secretariat headed by an Executive Secretary.

Chairman of the NSWG

Professor Humphrey Assisi Asobie
hasobie [at] yahoo [dot] com

NEITI focal point

Haruna Sa'eed, Executive Secretary, NEITI
hysaeed2002 [at] yahoo [dot] com
+234 803 311 3113.

For further information, please contact Eddie Rich in the EITI International Secretariat.