I am delighted to welcome you to this important event in efforts by NEITI to deliver results in the implementation of the provisions of NEITI Act and its obligations as a member of the global EITI.
First it promotes a culture and consensual framework for reporting and disclosure of payments and receipts in the extractive industry sector. In the past information on who paid or received what as tax, royalty, bonuses, levies in our country’s oil, gas and solid minerals sector were treated as confidential information. NEITI Audits is an opportunity for this information to be made public.
Secondly, NEITI Audit generates accurate data and credible information on flows of revenue, physical volumes of production of crude oil, expose governance or management process lapses and make recommendations on how the resources can be prudently managed to support national development.
But you may notice that between 2008 and now, the NEITI Audit is four years behind. For me personally and the new team in NEITI, this is not acceptable. We are determined to make NEITI Audits regular, comprehensive in content and timely in responding to national questions over governance and transparency in the extractive. We are committed to make NEITI Audit Reports a reliable reference point for the legislature, the civil society and the media as tools of monitoring, oversight and advocacy for enthronement of corporate governance in the extractive sector. For this to happen, NEITI plans to automate its audit process, information and data gathering methods in line with our annual work-plans and the development plans.
The event you are about to witness is the signing of agreement for the commencement of two key projects in that direction. The first is the conduct of oil and gas audit to cover the period 2009 to 2011. An indigenous firm SADA IDRIS & Co is the consultant. The project is to deliver the financial flows, establish cash calls, government crude liftings, and petroleum profit tax validations. Others are a report on non-financial flows, produce a report on royalty validation, carry out an index of covered entities and ensure insightful findings and recommendations on the management of oil and gas finances. For the physical audit, NEITI expects a report on production arrangements, upstream mass balance, product importation, pricing of federation equity crude, gas utilization, bid rounds management and a comprehensive report on Nigeria’s operations in the joint development zone.
The other project is conduct of solid minerals audit in Nigeria for the first time to cover the period 2007 to 2010. Again, another Nigerian firm HARUNA YAHAYA & Co is to handle the project. To get to this stage in the solid minerals sector, NEITI carried out a scoping study to establish base line information for the audit. NEITI expects to find out from the solid minerals audit, a report on tonnage/mined quarried minerals by major players as well as activities of entities in the manufacturing and construction sectors that derive their raw materials from mining and quarrying activities.
Other expectations from the audit include analyses of historical documents on production, export and payment of royalties for minerals produced in Nigeria. The Audit will also review systems and procedures for managing finances of the sector, establish feasibility reports of major players in the solid minerals sector, relevant laws as they affect mining sector, lapses and the way forward. The choice of these two Nigerian companies followed open, transparent international bid procurement process. Let me state once again, the confidence of NEITI in the ability of these selected firms to carry out the projects with professionalism, competence and integrity.
The signing of these agreements today marks the formal kick-off of these audits. While congratulating the auditors, I wish to strongly advise them to abide strictly by the terms and conditions of the contract, demonstrate commitment, diligence, courage, wisdom, resilience, drive and penetration in these assignments. Above all, NEITI expects you to prove that indigenous capacity in Nigeria is capable of carrying out even complex challenges. By NEITI Act, all companies and relevant government agencies involved in revenue management and custody are required to open their doors and books for your inquiry. NEITI will provide all necessary support to enable you meet both national and international expectations in these assignments.
I thank you all for your attention.