Tag: NEITI

The Nigerian Extractive Industries Transparency Initiative (NEITI) has said internally generated revenues (IGRs) of most states and local government areas (LGAs) are low compared with the federal government because some of the federally collected taxes are generated from activities at the sub-national level.

This was contained in NEITI Policy Brief document titled: “Beyond Assent: Pathways for Implementing Nigeria’s New Tax and Revenue Framework”.

The document added that the low level of states IGR was also attributable to their weak revenue generation capacity and low economic activities.

NEITI said, “Presently, the majority of States’ internally -generated revenues are low compared to federally collected revenues, which are in turn shared by the states  based on the federation revenue -sharing formula.

“While the low level of State lGR by the states and local governments may be partly attributable to weak generation capacity or low level of economic activities at the local level, one of the reasons is that some of the federally collected taxes like VAT, are actually generated by economic activities at the sub-national level.”

It explained that in practice under the new dispensation, the revenues would actually be collected by the National Revenue Service on behalf of the states.

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NEITI however sought policy options to ensure sub-national inclusiveness and federalism compliance.

The watchdog organization advocated that a fixed percentage of all federally collected sub-national taxes such as VAT, PAYE, mining royalties should be automatically remitted to the states and LGAs, with constitutional backing and published disbursement timelines.

It also sought the strengthening of administrative autonomy of State revenue authorities.

According to NEITI, while tax collection may be centralized, states should retain the right to administer local taxes, enforce compliance, and co-manage data  collection systems, especially for taxes domiciled within their jurisdiction.

The watchdog organization also sought the institutionalization of a Joint Tax Governance Council comprising representatives of the National Tax Act, State Boards of Internal Revenue, LGAs, and Civil Society to oversee the implementation of tax policy, resolve disputes and ensure equitable representation on revenue related decisions.

The document also urged the Federal Government to ensure disaggregated reporting of sub-national revenues.

It insisted that all revenues collected by the Nigeria Revenue Service on behalf of the sub-national entities must be reported by the state and LGA with monthly publication of remittance reports to enable public oversight and track equity in distribution.

NEITI called for the protection of states, LGA rights to extractive -derived revenues.

According to the document, royalties from mining and other extractive activities should be treated as shared revenues under the constitution, with a guaranteed return to host communities in line with the principles of derivation and environmental justice.

It also sought support for capacity building for state tax administrations.

NEITI said the centralization of revenue collection must not lead to the weakening of state tax systems.

It added that instead the reform should be accompanied by technical assistance, infrastructure investment, and data sharing protocols to enhance sub-national revenue administration.

Nigeria Extractive Industries Transparency Initiative (NEITI) has urged policymakers to harmonise Nigeria’s tax and regulatory frameworks in the solid minerals sector, warning that policy overlaps and multiple taxation continues to deter credible investors and limit sectoral growth.

 Speaking at the 2025 Nigeria Mining Week in Abuja, the Executive Secretary of NEITI, Orji Ogbonnaya Orji, called for a transparent, predictable, and investment-friendly fiscal environment to sustain the sector’s recent momentum, “Nigeria’s mining sector stands at a defining moment,” he said. “It is undergoing far-reaching reforms to reposition it from a largely informal and underperforming space into a cornerstone of our economic diversification and energy transition strategy.”

 Citing NEITI’s 2023 Solid Minerals Industry Report, Orji revealed that the sector’s contribution to GDP remains below 1 per cent, despite revenue growth from N339.57 billion in 2022 to N401.87 billion in 2023.

 He noted that artisanal and small-scale miners accounted for over 80 per cent of total production volumes but contributed less than 30 per cent of royalties, underscoring deep governance and structural gaps that require urgent reforms.

Orji commended the Federal Government for ongoing reforms — including the revocation of dormant licenses, deployment of Mining Marshals to combat illegal mining, and the launch of the Nigeria Mineral Resources Decision Support System (NMRDSS) to provide real-time geological data.

He also hailed the proposed review of the Nigerian Minerals and Mining Act (2007) to align with current realities, and the integration of climate accountability into mining operations under the Energy Transition Plan.

“These reforms mark a clear policy shift from discretion to data and from opacity to transparency,” he emphasized. “NEITI fully supports these efforts because transparency builds trust, and trust drives investment.”

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According to Orji, NEITI has evolved from merely an audit body to a reform institution that promotes fiscal accountability across the extractive value chain. The agency has also completed a national study on the impact of energy transition on Nigeria’s oil-dependent economy and developed a Policy Brief on Just Energy Transition and Climate Accountability, offering pathways for an inclusive and transparent shift to cleaner energy.

He further called for strategic focus on critical minerals such as lithium, cobalt, and manganese to position Nigeria advantageously in the global energy transition.

He also recommended creating a National Mineral Reserve Database accessible to investors and the public, streamlining fiscal and royalty regimes to eliminate duplication, promoting value addition and local processing, strengthening environmental, gender, and community frameworks, and deepening indigenous participation in mining operations.

In his address, President Bola Ahmed Tinubu, represented by the Secretary to the Government of the Federation, Senator George Akume, described the Nigeria Mining Week as “an emerging global forum shaping Nigeria’s economic renewal through collaboration and innovation.”

He reaffirmed that Nigeria must leverage its natural endowments responsibly: “When our mining sector thrives, it signals that value-added resource development is Africa’s way forward,” he said. “We must turn our minerals into miracles of development — ‘Minerals to Miracles’ must be our rallying cry.”

Tinubu reiterated the government’s commitment to ensuring that mining operations across Nigeria remain safe and beneficial to investors, workers, and host communities alike.

Earlier, the Minister of Solid Minerals Development, Oladele Alake, presented a status update on reform initiatives to reposition the sector as a major pillar of national growth.

On the sidelines of the event, Orji addressed a special mining forum organized by the Kaduna Mining Development Company, where he highlighted how subnational mining companies can drive institutional reforms and attract investment into state economies through transparency and accountability.

The Nigeria Extractive Industries Transparency Initiative (NEITI) has endorsed the Federal Government’s decision to revoke 1,263 mineral licenses over non-payment of statutory fees and royalties, describing the move as “bold, timely, and consistent” with its own findings.

The revoked licenses include: 584 exploration licenses, 65 mining leases, 144 quarry licenses, and 470 small-scale mining leases.

With this development, a total of 3,794 mineral titles have now been revoked under the current administration.

This figure includes 619 licenses cancelled for non-payment of service fees and 912 revoked in the previous year due to inactivity.

In a statement from NEITI House, the agency revealed that its 2023 Solid Minerals Industry Report identified 1,619 companies owing the government N680.3 million in unpaid fees and royalties.

This trend is not new. NEITI reports from previous years reveal similar patterns: In 2021, 238 companies with 289 valid licenses owed N1.06 billion, in 2020, more than 2,000 companies were in arrears, owing a combined N2.76 billion, earlier audits also flagged N654.28 million in outstanding payments from 233 companies holding 284 licenses.

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NEITI’s Executive Secretary, OrjinOgbonnaya Orji, stated: “These figures highlight a persistent culture of non-compliance that undermines revenue generation and erodes the credibility of the solid minerals sector.

Revoking these licenses sends a clear message that mineral titles are not speculative assets, but legal instruments that come with defined obligations.”

Ogbonnaya Orji emphasised that these sanctions will discourage future defaults and pave the way for serious investors equipped with the necessary capital and technology to engage in responsible exploration and mining.

He further noted that releasing these licenses from dormant or non-compliant operators will: Open access to genuine investors, increase competition, enhance the overall investment climate, and improve revenue collection

Beyond encouraging investment, the revocation targets a long-standing issue of revenue leakages. According to NEITI, billions of naira in unpaid fees could have supported critical sectors like infrastructure, education, and healthcare.

NEITI stressed that enforcing compliance not only boosts revenue but also promotes transparency and accountability—core elements for rebuilding trust in the extractive sector. In the long term, these actions align with Nigeria’s goal of economic diversification, shifting reliance away from oil and positioning solid minerals as a key driver of sustainable growth.

The agency praised the Ministry of Solid Minerals Development and the Mining Cadastral Office for acting decisively on issues NEITI has repeatedly raised in its audits.

NEITI however called for the urgent development of a comprehensive reform strategy for the solid minerals industry—one that attracts credible investors with capital, expertise, and commitment to responsible resource development.

Nigeria’s energy transition from hydrocarbon in 2060 may affect the over 100,000 direct jobs in the oil and gas industry, according to the Nigerian Extractive Industries Transparency Initiative (NEITI) yesterday.

The Executive Secretary, Dr. Orji Ogbonnaya Orji had said his speech at Abuja during the “Civil Society Organization/Media Roundtable A Framework For Engagements on Energy Transition Cost and Impacts for Non-state Actors”, said the transition will impact on jobs.

But as reporters asked him how it would impact on jobs, the NEITI boss said, the 2022 oil and gas industry audit alone indicated that were 29,000 direct workers in the industry.

According to him, a consideration of those that were involved in the provision of goods and services in the industry could account for over 100,000 workers.

His words: “In the oil and gas industry, for instance, our last report in 2022 shows that, oil and gas industry alone shows that over 29,000 workers, direct jobs, are working in the oil and gas industry.

Direct jobs: When I mean direct jobs, I mean those who go to work every day on those facilities. Now, if you check the indirect jobs, those who provide support services to the industry, you could be thinking that the oil and gas industry may be accounting for over 100,000 jobs directly.”

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Orji also described the oil and gas as the mainstay of the host communities and the government, which depends on it for revenue.

He said the  global shift from fossil fuels to renewables is reshaping economies and societies everywhere.

 For Nigeria, said Orji,  the transition is not optional; it is inevitable.

Analyzing the challenges that would come with the transition, he said “it will Challenge our fiscal planning and revenue base.”

Orji said it will deepen energy poverty if not properly managed at a time when 86 million Nigerians still lack access to electricity.

He said however, the transition also provides an opening for innovation, diversification, and a repositioned economy.

He said NEITI approached the study not as a formality, but as an urgent national necessity since the transition must be confronted with evidence, foresight, and strategy. Orji said consequently, under the

leadership of the National Stakeholders Working Group (NSWG) and with support from the Ford Foundation, NEITI commissioned the research.

According to him, the study is not taking place in isolation as it is firmly anchored in NEITI’s Policy on Climate Change, Energy Transition and Environmental Accountability, which was developed together with its civil society partners.

That policy, said Orji, commits NEITI to integrate climate and energy transition disclosures into its EITI reporting.

It also commits the organization to track emissions, stranded assets, and energy access gaps.

The policy, according to him, mandates NEITI to hold government and companies accountable for environmental justice and just transition commitments.

Meanwhile, the NSWG Alternate Chair, Ambassador Matthew Adole described the planned transition as risky to countries that are dependent on oil and gas for revenue, export, and energy consumption.

He said it was due to the recognition of the importance of the transition that the NSWG expressly approved the study to look into energy transition cost.