Back Taxes: IOCs to Pay $20 Billion

• Back Taxes: IOCs to Pay $20 Billion

International Oil Companies (IOCs) operating in Nigeria has been ordered to pay $20 billion in back taxes to states.

In a letter sent to the companies through the debt-collection arm of the government, Nigerian National Petroleum Corporation said international oil companies owe taxes for oil and gas production and outstanding royalties.

Government sources, who were briefed on the letters, were quoted as saying that Royal Dutch Shell, Chevron, Exxon Mobil, Eni, Total and Equinor were each asked to pay the Federal Government between $2.5bn and $5bn.

Norway’s Equinor, a company that produced about 45,000 barrels of crude oil a day, confirmed the request.

“Several operators have received similar claims in a case between the authorities in Nigeria and local authorities in parts of the country,” an Equinor spokesman was quoted as saying.

Exxon “is currently reviewing the matter”, a spokeswoman for the United States company said.

The letter was sent to the companies after the Federal Government and states settled their disagreement over the distribution of revenue from hydrocarbon production. They both agreed that Abuja would pay states billions of dollars, according to three company and government sources.

Equinor spokesman, however, “sees no merit to the case”.

Another source from one of the firms said, “This looks like an internal dispute between the federal and local governments. The central government is simply trying to shift to the IOCs (international oil companies) money it owes.”