…Says Nigeria lost $1.45bn crude oil in 2015
…Tasks govt on metering, recovery of $3.7bn outstanding revenues
30 December 2017, Sweetcrude, Abuja – The Nigerian Extractive Industries Transparency Initiative (NEITI) on Friday disclosed that the Nigerian National Petroleum Corporation (NNPC) had failed to remit more than $16.8 billion (about N5.15 trillion at N306.3 to $1) collected as dividends since the inception of the Nigeria Liquefied Natural Gas, NLNG, in 2000.
This was contained in NEITI’s 2015 Oil and Gas Audit Report released on Friday in Abuja which also revealed that Nigeria’s oil and gas revenues dropped from $54.5 billion in 2014 to $24.8 billion in 2015.
NEITI also revealed that Nigeria lost 27.1 million barrels of crude oil produced in 2015 despite huge expenses on industry security, added to the $25 million worth of crude that the Pipelines and Product Management Company (PPMC) reported as lost, the total comes to $1.45 billion for that year alone.
The report said: “The volume of crude oil declared lost to theft by 18 operators in 2015 was 27.1 million barrels. Though this amounted to only 3.5% of total oil production, the loss was valued at $1.4 billion. PPMC also declared loss of crude worth $25 million, bringing the total declared losses to $1.45 billion.
“Also, PPMC declared losing products worth N56.4 billion, broken down as follows: N52 billion for losses on petrol, N3.8 billion for losses on diesel, and N123 million for losses on kerosene. Deferred production on account of sabotage or repairs came to 57 million barrels.”
Losses are usually attributed to militant attacks, outright theft and other leakages.
The report also showed that the total crude oil lifting by NNPC in 2015 was 313,336 mbbls (inclusive of Nigerian Petroluem Development Company, NPDC, lifting of 15.31mmbls) which was less than the 2014 lifting of 349,622 mbbls, representing 10.38% drop. NNPC lifted 40.15% while the companies lifted 467,093 mbbls representing 49.85% of total volume of crude oil lifted in 2015.
It also showed that $586.011 million accounted for unreconciled export sales receivables in the year under review explaining that this is as a result of previous year unexplained/unreconciled difference. “The difference may continuously be carried forward.
“There should be proper reconciliation of unexplained/unreconciled difference of previous audit years
NNPC is ready to collaborate with NEITI to arrest the situation,” it noted.
Findings by the report also showed that the sum of $597.86 million was paid from the cash call account without appropriation.
“The non-cash call transactions of $597.86million were funded from both the CBN/NNPC JP Morgan Chase Cash Call Dollar Account and CBN/NNPC JV Naira Cash Call Account. Also, the sum of $238.06 million was collected as 3% Administrative Fee by NAPIMS,” it stated.
The report also remarked on a N317.476 billion accounted for unreconciled sales receivables in the year under review, noting that this is as a result of unexplained receivables.
“This imply shortfall in amount to be remitted by NNPC as domestic sales proceeds to the federation account.
NNPC should account for N317.476 billion and remit the said amount to the federation without delay,” it stated.
The report also stated that Nigeria’s oil production capacity fell from a total 798 million barrels in 2014 to 776 million barrels in 2015.
The report showed that total outstanding revenue from the sector as at 2015 stood at about $3.7 billion and N80 billion, with losses incurred at $2.2 billion and N60 billion, while unreconciled revenues amounted to about N317 billion.
It further showed that the total volume of crude oil loss in 2015 as a result of sabotage and theft from the operators’ facilities was 27,121,454 bbls. While loss as a result of deferment was 87,502,901 bbls, the total crude oil loss as a result of sabotage and theft (27,121,454 bbls) constituted 3.49% of the total production of 776,667,954 bbls) in 2015.
To address the issue of losses, NEITI reiterated its call for effective and adequate metering infrastructure and enhanced security of our oil and gas assets.
NEITI Executive Secretary, Mr. Waziri Adio, said at the release of the report that beyond the snapshots of what transpired in 2015, the latest report revealed monies to be recovered from different agencies, apart from recommendations on leakages to be blocked, and urgent reforms to be undertaken.
“This report reveals money to be recovered, leakages to be blocked, and urgent reforms to be undertake. The most critical take-away is the need to expedite, expand and sustain reforms in this still critical sector of national life.
“The most critical take-away is the need to expedite, expand and sustain reforms in this still critical sector of national life,” Mr. Adio said.