Nigeria Asks Oil Companies to Improve Data Reporting

http://www.businessweek.com/news/2010-07-13/nigeria-asks-oil-companies-to-improve-data-reporting.html

Nigeria, Africa’s biggest crude producer, asked oil companies operating in the West African country to provide more accurate production data.

Companies will be required to submit data from wellheads, flow stations and export terminals, Assisi Asobie, chairman of Nigeria Extractive Industries Transparency Initiative, or NEITI, said in an interview today in Lagos, Nigeria’s commercial hub. Producers currently report only the volume exported, he said.

“We want to have figures from these three points because there are leakages partly as a result of physical tampering of the system or the age of the pipelines,” Asobie said. “We want to know how much is lost.”

Receipts from crude exports account for about 90 percent of Nigeria’s foreign-exchange earnings. Attacks by armed groups in the Niger River delta, home to the country’s oil and gas industry, cut output by more than 28 percent between 2006 and 2009, according to Bloomberg data. Nigeria is the fifth-biggest source of U.S. oil imports.

To improve the accuracy of reporting, Nigeria will install more meters on oil pipelines, Asobie said.

“When we do that, the production figures we get will be more accurate,” he said.

NEITI has also asked agencies involved in monitoring oil companies reports to modernize their recording systems and harmonize their figures, “especially how they record what they receive from the oil companies,” Asobie said.

The agencies include the Federal Inland Revenue Service, the Department of Petroleum Resources, the Nigerian National Petroleum Corp. and the Central Bank of Nigeria.

“If you go to ask them separately, their figures don’t always tally, and together, their figures do not agree with figures from the oil companies,” Asobie said.

--Editors: Paul Richardson, Karl Maier.

To contact the reporter on this story: Vincent Nwanma in Lagos at vnwanma@bloomberg.net.

To contact the editor responsible for this story: Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net.