NNPC slams Auditor General denies not remitting N3.235 trillion

NNPC slams Auditor General  denies not remitting N3.235 trillion


The Nigerian National Petroleum Corporation, NNPC on Wednesday strongly denied a report by the Auditor General of the Federation, Samuel Ukura, that the corporation failed to remit about N3.235 trillion to the Federation Account as at December 31, 2014.

The Group Executive Director/Chief Financial Officer (Finance & Accounts) of NNPC, Isiaka Abdulrazaq, who described the claims as erroneous, said in a statement that the period covered by the report was before the coming of the current management in August 2015.
Mr. Abdulrazaq said since the appointment of the current management, emphases have been on transparency, accountability and integrity, while focusing on re-positioning its operations through over 20 reform initiatives.

He listed some of the initiatives to include regular publication of NNPC monthly financial and operational reports in the media; cost reduction that resulted in a drop in monthly operational losses from N30 billion in August 2015 to N3billion in January 2016, and structuring of NNPC to focus on improved performance and profitability.

“The declaration by the AuGF may have been borne out of misunderstanding of how revenues from crude oil and gas sales are remitted into the Federation Account,” he noted.

Mr. Abdulrazaq said that although NNPC usually get allocation of 445,000 barrels per day for processing into petroleum products for distribution to the nation, any unprocessed crude was sold and the proceeds used to pay for fuel importation.

“The proceeds from the sale of these products are remitted to the federation account after deducting the cost associated with the supply and distribution,” he said.

As a major supplier of petroleum products, he said the NNPC was entitled to claims on subsidy from petroleum products sold at government regulated price.

Mr. Abdulrazaq said between January 2012 and December 2014, total subsidy approved for NNPC and certified by Petroleum Products Pricing Regulatory Agency, PPPRA was about N2.34trillion, apart from additional N7.96billion claims still under reconciliation.

During the same period, he said losses from vandalism of crude oil pipelines and petroleum products stood at about N202.68billion, while petroleum products strategic holding cost and pipeline repairs and maintenance cost for the period gulped N358.88billion.
Consequently, he said the total figure the NNPC owed the Federation Account as at January 2015 Federation Account Allocation Committee (FAAC) meeting report was only N326.14 billion, which he said was still being reconciled, and not the N3.23trillion alleged by the AGF.

He said NNPC’s claims of N1.38 trillion pending against the Federation as at 2009 was currently being re-viewed by Forensic Auditors appointed by the former Minister of Finance, Ngozi Okonjo-Iweala.

“It is clear that the AuGF failed to reflect all the figures as they should be, not minding the fact that there is a clear process in conducting FAAC meetings where all Federation revenues are presented, discussed and approved,” Mr. Abdulrazaq said.

“There are series of meetings before and after FAAC meetings to reconcile and resolve any issue as the need may arise.”
He denied knowledge about another $235million allegedly transferred to undisclosed Escrow Account from the sale of natural gas, saying “NNPC does not have any secret Escrow Accounts”.

The $235Million, the NNPC Financial Controller explained, represented proceeds from the sale of gas feed stock to Nigerian Liquefied Natural Gas Limited, NLNG used to repay part of the Modified Carry Agreement, MCA loans, applicable royalty to the Department of Petroleum Resources, DPR and tax to the Federal Inland Revenue Service, FIRS.

He accused the AuGF of ignoring global best practice and established due process in auditing, by refusing to convene an exit meeting between the auditor and the auditee where any outstanding issues were finally discussed and explained before the issuance of the audit report.
“There was no such meeting, and NNPC did not receive any draft report from the AuGF’s office for comments,” Mr. Abdulrazaq argued.


At Newsweb Express we don't only break the news, we are committed to investigative and developmental journalism

You may also like...

1 Response

  1. October 10, 2023

    … [Trackback]

    […] There you will find 15671 more Info to that Topic: newswebexpress.com/nnpc-slams-auditor-general-denies-not-remitting-n3-235-trillion/ […]

Leave a Reply

Your email address will not be published. Required fields are marked *