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ABUJA Jan 12 Nigeria's state oil company has
proposed legal amendments aimed at enabling the government to
increase royalties and other revenues from deepwater oil
OPEC member Nigeria has been hit hard by a slump in crude
oil prices in the last two years, which helped to push the
country into recession. And militant attacks in the southern
Niger Delta throughout 2016 have hampered production.
The proposed amendments relate to the Deep Offshore and
Inland Basin Production Sharing Contract (PSC) Act.
The Nigerian National Petroleum Corporation (NNPC) said the
calculation of what was due to the government should be "based
on production and price to guarantee fairness and balance
between PSC contractors and government".
In a presentation to the lower house of parliament, NNPC's
chief operating officer for upstream operations, Bello Rabiu,
said the current graduated royalty scale should be removed.
"It is our opinion that the proposal to increase the royalty
rate for terrains beyond 1000 metres, from zero percent to 3
percent, is commendable but it is necessary to also make
corresponding adjustments in other categories," he said.
NNPC also said the petroleum minister should have powers to
intermittently set royalties payable for acreages located in
deep offshore and inland basin production-sharing contracts.
The company also said some incentives should be removed,
including the investment tax credit, investment tax allowance
and capital allowances to PSC contractors.
(Reporting by Camillus Eboh and Alexis Akwagyiram; Editing by