Ike Amos
In its Oil and Gas Audit Report for 2021, NEITI disclosed that the discrepancies amounted to a total of N198.1 billion raised a number of red flags about the integrity and accuracy of the country’s oil and gas earnings.
Giving a breakdown of the discrepancies, the extractive industries watchdog stated that the sum of N107.47 billion was validated as domestic gas revenue in 2021, based on the records of the Crude Oil Marketing Division of the NNPC, while in NAPIMS’ Audited Financial Statement for the same period, the item was reported as N84.47 billion.
It added that $1.57 billion (N624.67billion) was validated as export gas revenue based on COMD record, while NAPIMS reported the same item as N563.98 billion in its 2021 financials.
NEITI also stated that COMD recorded the sum of $1.64 billion (N655.16 billion) as export crude oil sales revenue, however, NAPIMS reported the same item as N540.75 billion in its 2021 NAPIMS AFS.
The transparency watchdog explained that discrepancies in records raise concerns about the integrity and accuracy of the data.
It said: “The COMD record being referenced is the actual cash received into the gas revenue account based on Federation Account Allocation Committee (FAAC) report. However, NAPIMS AFS is based on the accrual concept of accounting in line with International Financial Reporting Standard (IFRS).”
It urged the NNPCL to take steps towards improving its data management processes and establish controls to prevent future discrepancies.
“Regular monitoring, data reconciliation, and cross-verification can help minimise the occurrence of such discrepancies and maintain data integrity,” NEITI advised.
The agency added that in the year under review, the country earned $194.85 million and N9.73 billion from pipeline transportation from joint venture operations, adding that while the dollar receipt was remitted to the Federation Account, the Naira receipt was neither remitted to the Federation nor was it properly accounted for.
It added that there was no adequate disclosure of tariff rate and volumes with respect to what was paid to NNPCL by the JV operators.
While it noted that the disputed amount is still being reconciled, it however, acknowledged efforts by the NNPC, while it recommended that any reconciliation of discrepancies should be concluded in a timely manner to ensure the Federation receives revenues due to it as at when due.
