50 Oil Companies evaded a billion-dollar tax since independence, Audit reveals.
An audit conducted by an independent institution has released shocking findings that over 50 oil Companies have evaded $1.5b dollars in taxes since independence, VP Wani Iga said on Wednesday during the launching of the country’s first Oil licensing Round in Juba.
The Vice President for Economic Cluster said that the evaded money was meant for service delivery, both in the oil producing areas and other parts of the country, too.
“We have exempted 40 of them and out of those 5,000, 50 companies we discovered and uncovered that unpaid PIT amounting to 1.5 billion U.S dollar just in the period of ten years,” said Dr. Wani Igga.
“The service companies are carrying out their activities but most of them have never pay personal income taxes (PIT) since the independence in 2011,” he said.
The Vice President further went on to caution the companies against the vices in the oil sector.
“We are still scrutinizing the remaining over 400 service companies. This is not including the sum of 3.3 billion due to the country from the cost recovery. This amount owed by oil companies are arrears of the government,” he added.
During a cabinet meeting headed by President Kiir, it was revealed that oil companies failed to remit a mammoth amount of over $3.3b as ‘cost recovery expenses’ as provided in production Sharing Agreements signed between the oil companies and the Government.
South Sudan on Wednesday officially launched its first oil licensing auction with five blocks on offer, the Ministry of Petroleum said in a statement.
“The oil licensing round aims to attract interest from a diverse group of foreign investors to a region that is already home to oil and gas majors from China and Malaysia,” the ministry said.
China National Petroleum Corporation and Malaysia’s Petronas are operating in the landlocked East African country, which is slowly rebuilding a key economic sector after a five-year civil war that ended with a ceasefire and power-sharing deal in 2018.
The country gains almost all its revenue from oil and has boosted output as it tries to reach prewar production levels of 350,000 to 400,000 barrels per day (bpd).
The ministry said on Wednesday that once the period for expressions of interest closes, it will host a virtual series of data presentations followed by an international roadshow.
The government has announced that up to 20,000 kilometer square of potential oil blocks in South Sudan is up for exploration.
According to the government, approximately 90 percent of South Sudan’s oil and gas reserves have not been explored.
the Ministry of Petroleum declared most parts of the country open for exploration.
The areas viewed to have potential oil and gas are Upper Nile, Jonglei, Warrap, Unity, Northern Bahr el Ghazal states, and Ruweng and Pibor Administrative Areas.
The map also shows parts of Western Bahr el Ghazal, Lakes, Eastern, and Central Equatoria states to be ready for exploration.
The new blocks include A2, A5, B1, B4, and D2 which cover areas in Unity, Upper Nile, Jonglei, Eastern Equatoria, and some parts of Central Equatoria states.
The map also shows parts of Western Bahr el Ghazal, and Lakes states to be ready for exploration.