CONFIDEN TIAL DRAFT 2009
NAPIMS Financial statements !US$'000
Total
11,117,836
NNPC revenue schedules!US$'000
Difference US$'000
11,213,917
(96,081)
2002
Equity crude
5,891,001
5,891,001
(0)
Domestic crude
2,944,981
2,944,981
0
Total
8,835,982
8,835,982 0
Table 18: Differences in crude oil revenue as recorded by NAPIMS and compared to NNPC s data.
12. Sale of the National Entitlement (Gas) 8. Overview Nigeria is endowed with abundant natural gas resources, which in energy terms, is in excess of the nation s proven crude oil reserve. More so, the gas was discovered whilst searching for crude oil, as no deliberate effort had been made to search for natural gas. The current reserved estimate of the Nigerian gas is over 120 (EIA: 187 as of December 2010) trillion cubic feet, with about 50/50 distribution ratio between Associated Gas (AG) and Non Associated Gas (NAG). In order to diversify its revenue base and reduce the huge wastage of valuable resource as well as the degradation of the environment as a result of flaring, the Nigerian Government, through the NNPC, is vigorously pursuing a number of natural gas utilization projects with its joint venture partners whereby associated gas would be harnessed to achieve these objectives. Current Fiscal Incentives in the Nigerian Oil and Gas Industry are as follows:
91
•
All capital costs of upstream gas investments up to the custody transfer points are treated as oil investments and the resulting capital allowances are deducted from PPT (at a marginal rate of 85%). These incentives also apply to some downstream investments.
•
The upstream producer is exempted from payment of royalty and PPT on any gas that is transferred to a downstream project.