NNPC Cornered $5Bn in 3 Years-NEITI

Nigerian National Petroleum Corporation (NNPC) has been indicted over failure to remit $4.84 billion from the Nigerian Liquefied Natural Gas (NLNG) to the Federation Account in line with statutory provisions, according to an audit, commissioned by the Nigeria Extractive Industries Transparency Initiative (NEITI).


NEITI revealed that the amount was made up of payments by the NLNG to the NNPC as part of dividends and repayment of loans from 2009 to 2011.


The report noted that there was no record indicating that such monies were remitted to the Federation Account.


The audit, conducted by Sada Idris and Co., reported that Nigeria earned $143.5 billion (N22.24 trillion) from the sector from 2009 to 2011.


It also revealed that the NNPC owed the Federation Account N1.305 trillion as at December 31, 2011.


Ledum Mitee, chairman, NEITI board, who presented the findings of the audit of the petroleum sector from 2009 to 2011, said that the country lost N98.3 billion during the period to differential in the conversion rate between the NNPC and the Central Bank of Nigeria (CBN).


Mitee said the audit also highlighted unresolved differences between what government received and what companies claimed to have paid.


“From this report, the total financial flows to the federation from the oil and gas sector from 2009 to 2011 was $143.5 billion. This amount is made up of proceeds from the sales of equity crude, royalty, signature bonus, concession rentals, gas flaring penalties, petroleum profit tax (PPT) and company income tax.


“A breakdown of these earnings shows that sales of crude oil and gas within the period under review amounted to $81.9 biilon.


“The total sum of revenues that accrued to government from PPT, royalty, signature bonus, gas flaring penalties and concessional rentals amounted to $45.7 billion; revenue from companies’ income tax, value added and withholding tax within the period under review amounted to $6.1 billion while the sum of $4.8 billion was reported as revenue from dividends and repayment of loans by NLNG,” he asid.


Mitee explained that the audit showed that the total revenue flows to states arising from withholding tax and pay-as-you-earn was $1.5 billion while the total revenue flows to other entities arising from contributions to the Niger Delta Development Corporation (NDDC) and education tax was $3.2 billion.


“From a further breakdown, the actual direct revenue flows to the Federation Account during the period covered by the report was $133.8 billion, the revenue flows to states amounted to $1.6 billion while revenue flows to other Federal Government entities such as NDDC and Education Tax (TETFund) amounted to $3.2 billion bringing the total to the earlier reported government earnings of $143.5b.”