22 March 2016, Sweetcrude, Abuja – The Revenue Mobilisation Allocation and Fiscal Commission, RMAFC, yesterday, confirmed that available records at its disposal indicate that between January 2011 and December 2015, the total indebtedness of Nigerian National Petroleum Corporation, NNPC, to the Federation Account was N4.9 trillion.
This appears to confirm the Auditor General of the Federation’s claim that NNPC was yet to remit the sum of N4.9 trillion to the Federation Account.
The RMAFC disclosed in a statement signed by its spokesman, Mr. Ibrahim Mohammed, and made available to our correspondent in Abuja, that the figure included NNPC’s claims for subsidy on petroleum products, crude and product losses, strategic reserves and the pipeline maintenance cost.
The statement added that while the said report claimed that NNPC owed the sum of N3.2 trillion to the Federation Account in 2014, from the domestic crude sale, the Commission’s records revealed that the corporation owed the Federation Account the sum of N1.99 trillion only in 2014 from domestic crude sales.
Therefore, it stated, the figure quoted by the Auditor-General of the Federation must have included revenues from other sources.
According to the statement, “With regards to the alleged payment of US$235 million realised from the sale of Natural Gas into an undisclosed Escrow Accounts by the NNPC, the Commission explained that the NNPC on behalf of the NLNG had entered into agreements with three International Oil Companies (IOCs) including Nigeria Agip Oil Company (NAOC), Shell Petroleum Development Company of Nigeria (SPDC), Total E&P Nigeria Limited (TEPNG) under a Modified Carry Agreement (MCA) proceeds from which are deposited in Escrow Accounts for funding the various Gas projects under the LNNG.
“The total amount transferred to the various accounts from 2012 to November 2015 was $1.615 billion. The Commission, through the FAAC Post Mortem, has consistently requested the NNPC to provide it with updated financial statements on the projects but NNPC was yet to respond,” RMAFC said.
Recall that the Commission had been working with NNPC to reconcile the figures following a tripartite meeting held with the NNPC, Federal Ministry of Finance, FMF, and RMAFC in December, 2015 where it was agreed that in view of the subsidy and other claims by NNPC, the Forensic Audit of the NNPC was very critical in establishing which party was actually indebted to the other.
The Forensic Audit was expected to be concluded by the end of March 2016.
The NNPC in a statement last week faulted the claim by the Auditor-General of the Federation (AuGF) that it failed to remit N3.235 trillion to the federation in 2014.
“The declaration by the AuGF (Auditor General of the Federation) may have been as a result of a misunderstanding of how revenues from crude oil and gas sales are remitted into the Federation Account,” said NNPC Chief Financial Officer Isiaka Abdulrazaq in the statement.
“NNPC wishes to state in strong terms that the AuGF’s declaration is erroneous,” he said, adding that the auditor-general had failed to account for costs including a fuel subsidy, pipeline vandalism and maintenance.
“Consequently, the figure owed to the Federation Account as at January 2015 Federation Account Allocation Committee (FAAC) meeting report was N326,142,137,205.79 ($1.64 billion) and not the N3.23 trillion alleged by the AuGF,” he said.
According to him, the report did not include NNPC’s claim of N1,374 trillion as at 2009, against the federation. “All the stakeholders in FAAC meeting are familiar with the N326.14 billion and it is already in the public domain since then to date.
He added that the N1.374 trillion claims against the federation were currently being re-viewed by Ministry of Finance appointed Forensic Auditors at the instance of the Minister of Finance.
In 2014, the then central bank governor, Lamido Sanusi, was suspended after accusing the NNPC of failing to pay $20 billion into government accounts between January 2012 and July 2013.