A PRINCELY N800 billion was generated internally by the Department of Petroleum Resources (DPR) in 2008, the House of Representatives learnt yesterday. Speaking at the budget defence of
the Ministry of Petroleum Resources with the assembly’s Committee on the upstream sector of the petroleum industry, the DPR’s acting director, Mr Billy Agha, disclosed that the sum was from royalties, gas flaring and concessions, among others.
He explained that the department’s projected revenue for 2009 would, however, be less than those of previous years because of the present sharp decline in the prices of crude oil and in production capacity.
Agha said that of the N800 billion, about N638 billion had been received by the department while the N162 billion balance was being owed by some major companies and contractors. He declared that the projection for 2009 is N365 billion.
The committee noted that some projects for which money was allocated and released in 2008 were returned to the treasury, adding that such projects would be included in the 2009 budget. These include the Gas Royalty Reconciliation, Obob-Oben pipeline project and the Phases1&2 of the Lagos-Escravos pipeline expansion project.
Defending the 2008 Appropriation Bill, the Minister of State for Petroleum Resources, Mr Odein Ajumogobia (SAN) told the committee that the projects were excluded in the budget envelop from the Ministry of Finance. But the committee insisted that the projects must be rolled over.
A member of the committee, Ifaluyi Isibor, representing Egor/Ikpoba federal constituencies of Edo State, had drawn the attention of the Minister to the N300 million in the capital project performance, which indicated that the money was released. The project was reportedly stalled because of the late release of Due Process certificate.
Asked if the projects and similar others were still relevant, the Minister spoke in the affirrmative, disclosing that President Umaru Musa Yar’Adua is personally interested in them.
The chairman of the committee, Bassey Otu, praised the ministry for returning the N6 billion voted for the Lagos- Escravos gas pipeline, but added that it would be against the interest of the people and the development of the gas sector if it was discontinued.
The committee asked the minister to provide details of allocations for overhead in the 2009 budget, as well as those of contracts awarded and executed.
Ajumogobia assured the committee that the cut in oil production, presribed by the Organisation of Petroleum Exporting Countries (OPEC), would not affect the revenue sources as the surplus of 2008 would be used to make up for any shortcoming.