Shell Pays FG $4.5bn As Production Entitlement, Taxes, Royalties, Fees In 2022 .Pays $79,844,884 to NDDC

 

Shell Report on Payments to governments has indicated that the Federal Government of Nigeria was paid a total sum of $4,521,134,915 in 2022.

This amount is made up of the money paid as production entitlement, taxes, royalties, and fees in  2022.

The disclosure was part of Shell’s reports on Sustainability, Climate & Energy Transition, Lobbying and Payments to Governments that were published on Tuesday.

A breakdown of the amount showed that the company through its local companies in the country, Shell Petroleum Development Company (SPDC) and Shell Nigeria Exploration and Production Company (SNEPCo) paid $3,035,996 as Production entitlement, Taxes $711, 850,070, Royalties  $691, 648,502 – and  Fees  $81,639,634, all amounting to $4,521,134,915.

Further analysis of the payment also showed that money realised through Production Sharing Contract (PSC) —  (OPL212/OML118, OPL219/OML135), as production entitlement to the government was $539,313,819, taxes -278,348,859, royalties – $480,566,486  and fees – $20,737,019. These amounted to $1,318,966,183.

Production entitlement from the company’s West Asset amounted to $1,783,447,897. 

It was only tax that was paid in respect of PSC 1993 (OML133) and this amounted to $194,604,155.

The company’s East Asset attracted a production entitlement of $713,234,993, while  other royalties, taxes and fees paid by SPDC stood at $510,881,687.

Shell in its latest report on payment to governments, stated: “Our operations generate revenue through taxes and royalties for governments around the world. These taxes and royalties are often used by governments to fund essential public services like education, transport and healthcare.

“Since 2016, Shell has made mandatory disclosures under the UK’s Reports on Payments to Governments Regulations 2014 (amended December 2015). We have published the revenues that our operations generate through taxes and royalties on a voluntary basis since 2012. We believe that being open about our tax payments helps people to understand how much we pay and why.

"In 2022, Shell paid $68.2billion to governments. We paid $13.4billion in corporate income taxes and $8.2billion in government royalties. In addition, we collected $46.6billion in excise duties, sales taxes and similar levies on our fuel and other products on behalf of governments.”

Shell has been formally reporting on sustainability-related performance for more than 25 years, with the aim of being transparent about activities that are important to investors, governments, and civil society. 

The Shell Sustainability Report outlines our social, safety and environmental performance in 2022 and sets out our progress in transitioning our business to net-zero emissions.

In his introduction to the report, Shell’s Chief Executive Officer, Wael Sawan, said: “As we invest in the energy needed today, our target to become a net-zero emissions energy business by 2050 remains at the heart of our strategy. We are making good progress. By the end of 2022, we had reduced carbon emissions from our operations by 30percent compared with 2016 on a net basis, more than halfway towards our target of a 50percent reduction by 2030.

"This report shows what we have achieved so far in our work to be a sustainable business. We aim to do this work responsibly, with discipline and at pace to make a positive difference.

“Shell also published its new 2022 Climate and Energy Transition Lobbying Report. This is another step forward on our journey to increase transparency around our advocacy. It builds on the progress we have made since 2019 in reporting on the key industry associations we are members of, and in providing examples of our advocacy on our website.”