Nigeria’s solid minerals revenue surged to nearly triple its target while the country’s once-reliable natural gas dividends vanished entirely, raising questions about transparency in Africa’s largest economy, BusinessDay’s findings have revealed
Data sourced from the 2024 Federal Government Budget Performance Analysis, released by BudgIT, show that revenue from solid minerals reached N11.33 trillion, surpassing the budgeted N4.56 trillion, representing a 248.46 percent performance.
NLNG dividends, which historically contributed significantly to government coffers, delivered nothing, a zero percent performance that has raised serious questions about asset management and transparency.
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The report attributes the NLNG dividend failure to “rising vandalisation and attacks on gas pipelines,” but analysts argue that this explanation is insufficient, particularly given that the Nigerian National Petroleum Company Limited (NNPCL) holds equity in NLNG on behalf of the federal government.
“There needs to be some public explanation as to what is happening with the federal government’s due for the 2024 fiscal year,” the BudgIT report states, calling for an audit to provide critical answers.
Industry experts say the zero-dividend payout is unprecedented and suspicious, especially considering global energy market dynamics in 2024.
“This is unusual for the federal government,” the BudgIT report stated, noting that the NLNG had historically provided consistent returns and the “needs to be some public explanation as to what is happening with the federal government’s due for the 2024 fiscal year.”
The Nigeria Extractive Industries Transparency Initiative (NEITI) has documented extensive revenue leakages in the oil and gas sector, with pipeline vandalism costing the country billions annually. However, NLNG’s offshore operations and LNG export infrastructure are generally less vulnerable to the crude oil pipeline attacks that plague onshore facilities.
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The dividend silence becomes even more troubling when contrasted with the solid minerals sector’s extraordinary performance. The bulk of the N11.33 trillion in mining revenue was realised in the third and fourth quarters of 2024, suggesting either a sudden surge in mineral exploitation or improved collection mechanisms.
Vahyala Kwaga, research lead at BudgIT, emphasised that the NLNG situation represents “a loud silence from a revenue stream that used to be fairly consistent.”
“An audit is required to provide critical answers,” Kwaga stated, echoing the report’s recommendations. “The Petroleum Industry Act of 2021 mandates disclosure, and the public deserves to know why NNPCL’s equity holding in NLNG produced no returns for the federal government.”
The report also highlights broader structural revenue challenges. Despite improved performance in 2024, federal government non-oil revenue (N11.33 trillion) still did not exceed oil revenue, though it performed significantly better than in previous years.
Companies Income Tax hit N2.6 trillion (76.63 percent above budget), Value Added Tax reached N868.86 billion (69.42 percent above budget), and Customs Revenue generated N1.36 trillion (74.25 percent above budget), all demonstrating strong growth trajectories.
However, the actual oil revenue of N6.26 trillion, while representing 76.57 percent of the N8.18 trillion budget, still dominated the revenue mix, a situation analysts say leaves Nigeria vulnerable to global commodity price shocks.
The federal government’s total revenue of N20.98 trillion in 2024 represented an 18.92 percent shortfall from the N25.88 trillion budgeted, but it marked a 68.04 percent increase from 2023’s N12.48 trillion.
“As generally impressive as this revenue performance is, there are still structural issues requiring focus from the government,” the report said, calling for an audit to provide answers on the NLNG situation.
The federal government’s expenditure reached N34.49 trillion for the year, with debt service consuming N12.63 trillion, exceeding non-debt recurrent spending by over 3.8 trillion naira.
BudgIT, which monitors public spending in Africa’s largest economy, said the government needs to provide transparency on the NLNG dividend failure and ensure proper disclosure under existing petroleum sector laws.
Nigeria’s budget implementation has faced criticism after the National Assembly extended the 2024 capital expenditure deadline to December 2025, creating what the report called a situation where “the federal government is, in very clear terms, implementing 2 budgets at once.”
The BudgIT report recommends that the government conduct an immediate audit of NLNG dividends to identify reasons for non-collection and develop strategies to restore this revenue stream. It also calls for enhanced transparency in compliance with the Petroleum Industry Act.
