Don't Miss


Home   >   Business   >   Industries   >   Energy   >   NNPC owes Federation Account N862b -NEITTI

NNPC owes Federation Account N862b -NEITTI

By on November 3, 2011

The Nigerian National Petroleum Corporation (NNPC) owed the Federation Account N862billion between 2004 and 2008, the Executive Secretary, Nigeria Extractive Industries Transparency Initiative (NEITI), Mrs. Zainab Ahmed, has said.

But the NNPC denied this, saying that the figure presented by the NEITI boss does not reflect the transactions as well as current realities. The debt was on domestic crude according to the audit report of the NNPC by the NEITI, she said.

She said there was no response from the NNPC when informed about the discrepancies in the report.
Ahmed disclosed these yesterday while making her presentation before House of Representatives’ Joint Committee investigating NNPC’s non-remittance of N450billion to the Federation Account.

She said the debt was through deductions from the proceeds of domestic crude oil accruing to the Federation Account that were neither authorised nor legalised.

Ahmed, however, defended the submission on the NNPC’s debt after being informed by the committee that the Chairman of Revenue Mobilisation Allocation and Fiscal Commission (FMFAC) Mr Elias Mbam had earlier confirmed N450billion debt to the Federation Account by the NNPC.

But a former Group Managing Director of the Corporation, Mr Funsho Kupolokun, disputed the debt. He claimed that the Corporation was not indebted to the Federation Account during his tenure.
The investigation could not continue after the NEITI boss could not offer detailed explanations backed by documents on some raised questions.

Co-chairman of the panel, Bassey Ewa, requested for an audited report for the period under review and other documents that could assist  the committee.

Speaking to reporters after the session, Group General Manager, Group Public Affairs Division of the NNPC, Dr. Levi Ajuonuma, said it was obvious that the NEITI auditors failed to consider the peculiarities of the Corporation’s business processes and the terms of our commercial transactions.

He added that a principal term of the Corporation’s commercial arrangement is the credit period between crude sales and payments, which the NEITI auditors did not capture.

“We are hopeful that when she concludes her presentation before the committee, she will correct the error.
“Don’t forget that what was presented is based on the audit report of the Corporation’s operations as at December 31, 2008 and since then, things have changed.  Essentially, the N847 billion, which the report captured represents the cost of crude purchased by the Corporation from the Federation for September – December 2008, in addition to N450 billion under review’’ Ajuonuma stated.

He added:“In simple language, I can state without any fear of contradiction that the sum in question has since been settled at the Federation Accounts Allocation Committee(FAAC), meetings of January, February, March and April 2009.”

Nation