NNPC Didn’t Remit $4.7bn, N318bn to Federation Account – NEITI

The Nigerian National Petroleum Corporation and its subsidiary, the Nigerian Petroleum Development Company, did not remit a total of $4.7bn and N318.2bn to the Federation Account in 2014, the latest report of the Nigeria Extractive Industries Transparency Initiative had revealed.

NEITI also said that Nigeria earned $55.5bn from the oil and gas sector and N55.82bn from the solid minerals sector in 2014.

“The NEITI 2014 audit reports show that a total of $4.7bn and N318.2bn that should have gone to the Federation Account were not remitted by NPDC and its parent company, NNPC,” the firm said in its report released in Abuja on Friday.

It stated that losses from crude-for-product swap and Offshore Processing Arrangements were put at $198.7m in 2014.

At the close of the 2014 audits, NPDC had not paid the outstanding $1.7bn for the eight oil mining licences under the Shell joint venture divested to it by NNPC, adding that NPDC had also not paid for the four OMLs under the NAOC JV divested to it by NNPC.

It said, “Those four assets were recently valued by the Department of Petroleum Resources at $2.25bn; NPDC had sought clarification for the basis of the valuation.”

According to the reports, the total revenue flows for the oil and gas sector fell from $58.07 to $55.5bn between 2013 and 2014, a decline of about five per cent.

However, revenue flow for the solid minerals sector in 2014 showed a marked improvement over the previous year, with a 48 per cent rise from the N37.676bn of 2013 to N55.8bn in 2014.

It said 41 oil and gas companies and 16 government agencies were audited for the 2014 Oil and Gas Audit cycle.

These were the producing companies that made material payments of $5m and above to the federation in 2014 and the government agencies that received funds on behalf of the federation, NEITI said.

It further stated that 109 producing assets were active in the year, comprising 59 Joint Venture licenses; 26 Sole Risk and Marginal Field Operating licenses; 23 Production Sharing Contract licenses; and one Service Contract license.

The 2014 oil and gas audit also revealed that 22 billion litres of petroleum products were imported as against the 20 billion litres imported in 2013, with 950 million litres of the products locally produced in 2014 as against the 2.6 billion litres locally produced in 2013.

It said N1.2tn was processed as subsidy claims in 2014 as against the N1.3tn processed for subsidy in 2013; and N426.6bn was distributed in 2014 under the Subsidy Re-investment Programme, same as the SURE-P figure for 2013.

It noted that there was a shortfall of N250bn in remittance to Federation Account by NNPC, adding that the value of crude oil allocated to corporation for domestic use in 2014 came to $15.67bn or N2.44tn.

“Only N1.36tn was received in the year 2014 in respect of domestic crude oil, while the total deduction from domestic crude sales was N830bn. This therefore leaves an unremitted balance of N250bn from the domestic crude sales.”

PUNCH