Shell’s Annual Payment To Nigerian Govt Hits Six-year Low
The payment made to the Federal Government by Shell companies in Nigeria plunged by 42.45 per cent in 2020 to the lowest in six years.
Royal Dutch Shell said on Wednesday that its subsidiaries in Nigeria paid $3.24bn to the Nigerian government and its agencies last year, compared to $5.63bn in 2019 and $6.39bn in 2018.
The oil giant’s payment to the Nigerian government was $4.32bn in 2017, compared to $3.64bn in 2016, $4.95bn in 2015 and $3.02bn in 2014.
Shell, in its ‘Report on Payments to Governments Report for the Year 2020’, said payments made to governments arose from activities involving the exploration, prospection, discovery, development and extraction of minerals, oil and natural gas deposits or other materials.
The report showed that Nigeria’s revenue from Shell was the highest out of the 24 countries to which it made payments last year.
It revealed that Shell companies paid $2.28bn to the Nigerian National Petroleum Corporation last year as production entitlement, compared to $3.77bn in 2019.
The oil major said $440.39m was paid in taxes to the Federal Inland Revenue Service, down from $1.28bn in 2019.
It said the Department of Petroleum Resources was paid $451.51 for royalties and fees, compared to $1.25 in 2019.
According to the report, $73.42m was remitted to the Niger Delta Development Commission, down from $81.5m in 2019.
Shell reported in February a loss of $21.68bn for the year 2020, compared with a profit of $15.84bn a year before. Last year, Shell cut its dividend for the first time since World War II following a dramatic slide in oil prices amid the coronavirus crisis.
It said in September 2020 that it planned to cut 7,000 to 9,000 jobs, saying the cuts would be implemented by 2022 and included 1,500 people who were taking voluntary redundancy.
Other reports released by the oil giant on Wednesday included Shell Sustainability Report and Industry Associations Climate Review.
The Chief Executive Officer, Ben van Beurden, said in the sustainability report that the COVID-19 pandemic made 2020 a deeply challenging year.
“Tragically, it led to the deaths of 20 of our Shell colleagues, painful evidence of the gravity of the situation in many parts of the world,” he said.
He said the pandemic caused severe disruption to the global economy and people’s livelihoods, and led to a fall in energy demand and carbon dioxide emissions.
According to him, there were zero fatal accidents in Shell-operated facilities in 2020 for the first time in the oil major’s history.
The Shell boss said, “We continue to work hard to raise standards in this area, learning from our own experiences and from others.
“In March 2021, we were pleased that Shell and four former employees were acquitted in a long-running trial in Milan related to a Nigerian oil block called OPL 245.”
He added that the case had been a difficult learning experience for the company.