The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, said on Wednesday Nigeria lost $21 billion on oil Production Sharing Contact (PSC) in the last 20 years.
The minister said previous governments failed to exploit opportunity of the Deep Offshore Act that made provision for premium element to be shared once the price of crude exceeds $20 per barrel.
He said that the Federal Executive Council (FEC) meeting on Wednesday approved steps to amend section 15 of the PSC of the Deep Offshore Act.
Kachikwu briefed State House correspondents at the end of FEC meeting chaired by Vice President Yemi Osinbajo at the Presidential Villa, Abuja.
The Minister of Transportation, Rotimi Amaechi, Minister of Niger Delta Affairs, Usani Uguru Usani and the Senior Special Assistant on Media and Publicity to the President, Garba Shehu, also attended the briefing.
Kachikwu said: “The first and most substantial thing for me is the decision to work with the Attorney General of the Federation to amend section 15 of the Production Sharing Contract (PSC) of the deep offshore act.
“Under the deep offshore act, there was a provision in 1993 that once the price of crude exceeds $20 a barrel, the government will take steps to ensure that that premium element is then distributed at an agreed premium level for the federal government so that we get more for our oil.
“But over the last 20 years, nothing really was done. From 1993 to now, cumulatively, we have lost a total of $21 billion just because government did not act. We did not exercise it.
“In 2013 there was a notice to oil companies that we were going to do this but we didn’t follow through in terms of going to Council to get approval.
One of the things we’ve worked on very hard over the last one year is to get that amendment because once we do, the net effect for us is close to $2 billion extra revenue for the federation.”