Nigeria lost $22 billion, about N3.8 trillion to trade misinvoicing and other anomalies in the petroleum sector in 10 years, between 2002 and 2011.

This, according to a report released yesterday, titled, the ‘2014 Nigeria Natural Resource Charter (NNRC) Benchmarking Report’, is due partly to weak cost regulation in the oil and gas sector.

The amount lost is 76.6 per cent of the figure budgeted for the 2014 fiscal year. Trade misinvoicing is a method for moving money illicitly across borders which involves deliberately misreporting the value of a commercial transaction on an invoice submitted to customs or other agencies of government.

The report, presented by the Nigerian Resource Governance Institute (NRGI), the Centre for Public Policy and Advocacy (CPPA) among others, summarises the second benchmarking of Nigeria’s petroleum sector governance against the 12 precepts of the Natural Resource Charter.

The NNRC is led by a 14-member independent, multidisciplinary expert advisory panel, comprising Mr. Odein Ajumogobia; Former Minister of Petroleum and Foreign Affairs Minister, Mr. Adeola Adenikinju; a Professor of Economics from the University of Ibadan, Mr. Bode Agusto; Former Director General of the Budget Office and Professor Akpan Ekpo; Director General West African Institute for Financial and Economic Management, among others.

According to the report, fiscal policies for petroleum production contracts in Nigeria, especially the Production Sharing Contracts (PSC) that govern deep water operations, have failed to ensure that the government received a rising share of revenue in periods of potential increased profitability.

The report said, “Experts also recount extensive revenue losses due to weak cost regulation.”