Dear Professor Osinbajo, GCON,
Vice President of Nigeria,
Abuja, Nigeria.
12/12/2018

Re: Nigeria's Total Earnings from Sale of Crude Oil was $383billion from May 2010 to May 2015.

Sir, I think there is a mix-up in your lines here. You must have assumed revenue is the same as earnings.

Sir, Nigeria never earned $383 billion from sale of crude oil during the Goodluck Ebele Jonathan era. In fact, Nigeria as a country has not earned a total of $383 billion from the sale of oil in the last 19 years.

Sir, if you say the total revenue accrued to Nigeria and her partners is $383billion that will be factual. Revenue is the amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise, while earnings are the amount of profit that a company produces during a specific period.

The total revenue accrued to Nigeria is inclusive of the share of all the major players in the oil sector. When the sharing formula and all necessary deductions are applied, we will be left with a very little fraction of what you quoted, sir.

This shows clearly sale of crude oil cannot rescue Nigeria. This is a clear pointer that Nigeria has to look inwards for other sources of revenue.

Sir, between May 2010 and May 2015 the USD was averaging between N150, N155, N166 to $1 and climaxed at N218 by February 2015. It means the total crude oil lifting value without any deductions in Nigerian Naira is equivalent to N59.4trillion in five years, which means the total revenue from oil annually was N11.9trillion using N155 to $1, which was CBN official rate.

As at today USD is averaging N305-$1. It rose from N218-N288-N400-N500, before we got to N360 to $1, but the CBN retained its official rate at $1-N305.

The parallel market sells for N360+ for $1. According to the record of NNPC, the total revenue from crude oil accrued to Nigeria and her partners between June 2015 and July 2018, which is a three-year period is $113.2billion.

It means the total revenue accrued to Nigeria and her partners in the last three years is N34.6trillion using N350 to $1 official rates (June 2015-June 2018). This means Nigeria's total revenue from sale of crude oil annually from June 2015 till date is N11.5trillion.

Sir, between May 2011 till date, Nigeria's total revenue from sale of crude oil when converted to Nigeria Naira is at par.

Sir, I think you didn't take note of the fact that we will have more Nigerian Naira against fewer Dollars, all thanks to devaluation, the same mistake you made when you spoke on Nigeria's debt profile.

Sir, I think it is necessary to put the record straight since we are in the electioneering season — wrong information will be pushed to the public space by politicians all in a bid to sway the general populace.

Regards,
Ettu Mohammed.

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