Full
disclosure in the administration of crude sales remains an issue at the
Nigerian National Petroleum Corporation (NNPC) despite current efforts at
enthroning
transparency in the conduct of government business.
An account
reconciliation activity for crude oil transactions found gaps in the
corporation’s reporting and remittances to the Federation Account for the month
of October 2017.
State
governments had boycotted the Federation Account Allocation Committee (FAAC)
meeting on November 23, accusing the NNPC of cutting corners in reporting and
remitting of receipts from oil in the period under review. The states insisted
on thorough collation and reconciliation through representatives agreed upon by
all the parties.
The ensuing
investigation and reconciliation uncovered the sum of N58.369 billion in
unremitted funds and forced the state-owned company to issue fresh payment
mandates to the Central Bank of Nigeria (CBN) to fund the Federation Account as
well as the joint venture production (JVP) Account by the same amount.
The Guardian
learnt that N30 billion of the N58.369 billion meant for remittance was
allegedly withheld, as it could not be traced in the Federation Account.
The
Federation Account payment mandate directive to the CBN carries the value of
N58.369 billion for the October 2017 crude oil receipts, while the payment
mandate directive for the JVP cash call funding for October 2017 has a value of
N29.985 billion.
The October
FAAC meeting finally held on Thursday, December 7, 2017, after the revenue
figures were reconciled and the NNPC made full remittance into the Federation
Account.
This
additional N30 billion revenue available for distribution to the three tiers of
government in the following order: Federal Government, N13.749 billion; states,
N6.973 billion; local councils, N5.376 billion and oil mineral producing
states, N3.9 billion.
According to
Mr. Mahmoud Yunusa, who chairs a body of commissioners of finance from the 36
states and Abuja, the new trend (under-reporting of oil revenue by the NNPC)
will force states to be actively involved in collation and preparation of NNPC
revenue account to prevent a recurrence. Yunusa said the states would engage
“sit-in” consultants who will liaise with the NNPC to collate and reconcile
revenue figures on monthly basis.
A similar
incident had occurred during the administration of the late former president,
Umaru Musa Yar’Adua’s which led to a forensic audit discovery of N450 billion
in under-reporting and non-remittance to the Federation Account. It was agreed
at the time that the repayment process, which was only concluded three months
ago, should be made on an installment basis.
But Mr. Ndu
Ughmadu, the Group General Manager of Public Affairs Division (GGM PAD) at the
NNPC, would neither confirm nor deny if there were non-remittances, since,
according to him, “it has to do with financials.” He promised to cross- check
the facts.
The NNPC
spokesman said he was not aware that that states boycotted the November 23 FAAC
meeting. Instead, he explained that the meeting could not hold because there
was a directive by the National Council of State for a reconciliation of the
NNPC Account. The directive, he said, was given because there were “some
contestations” from some stakeholders (the states).
Ughamadu
added: “The FAAC was not boycotted. There were issues relating to the
interpretation of data presented by the NNPC, and the National Council of State
directed that all stakeholders should jointly look into the Account.
“I cannot
comment on the claimed N30 billion additional remittances into the Federation
Account because that has to do with financials and there is no way I can verify
it right now because today is Sunday; I will have to find out.”
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