Friday 6 February 2015
Audit: PwC indicts NNPC, orders refund of $1.48bn tofederation account
PriceWaterhouseCoopers (PwC) has ordered Nigerian National
Petroleum Corporation (NNPC) to refund $1.48 billion into the
federation account.
The directive was contained in the report of its forensic audit
into allegations of unremitted funds by the regulatory body.
The report, which was released to newsmen yesterday by the
Auditor General for the Federation (AGF), Mr. Ukura Samuel,
said the total gross revenue generated from the crude oil
liftings was $69.34 billion and not $67 billion as bandied in
some quarters, including the Senate Reconciliation Committee
from January 2012 to July 2013.
It said that within the $69.34 billion, $28.22 billion was the
value of domestic crude oil allocated to NNPC and the total
amount spent as subsidy for Premium Motor Spirit otherwise
known as petrol amounted to $3.38 billion.
Also, the total amount spent as subsidy for DPK (not
appropriated) amounted to $3.38 billion while the total third
party financing arrangement and equity crude oil processing
costs amounted to $1.19 billion.
The report said that the total cost directly attributable to
domestic crude oil amounted to $1.46 billion whereas other
costs incurred by the corporation not directly attributable to
domestic crude oil is $2.81 billion.
“Revenue attributable to NNPC as submitted by the former
NPDC Managing Director at the Senate hearing (less PPT and
Royalty paid) was $5.11 billion,” the report said.
PwC stated that this amount needs to be incorporated into the
financial statements of NPDC from where dividend should be
declared to the federation accounts while signature bonus,
PPT and Royalty yet to be paid by NPDC is $2.22 billion.
“Total cash remitted into the federation account in relation to
crude oil liftings was $50.81 billion and not $47 billion as
earlier stated by the Senate Reconciliation Committee for the
period from January 2012 to July 2013.
Based on the information available to PwC and from the
analysis the audit firm submitted that NNPC and NPDC should
refund to the federation account a minimum of $1.48 billion.
In addition to the report, PwC recommended that the NNPC
model of operation must be reviewed and restructured as the
current model, which has been in operation since the creation
of the corporation cannot be sustained.
Recall that the Federal Government, last year, appointed PwC,
an international audit firm, to conduct a forensic audit of
NNPC after the former CBN Governor, Alhaji Sanusi Lamido
Sanusi, had written a letter to Jonathan over the non-
remittance of $49.8 billion to the federation account by the
corporation between January 2012 and July 2013.
The revelation led to an unprecedented uproar among
Nigerians. As a result of pressure from different quarters over
the allegation, Sanusi revised the amount from $49.8 billion to
$10.8 billion and later to $20 billion, a development many
believe led to his eventual sack by the Federal Government.
No, we were not indicted – NNPC
ADEWALE SANYAOLU
The NNPC yesterday maintained that the forensic audit report
on the alleged missing $20billion oil revenue carried out by
PriceWaterhouseCoopers absolved it of any wrong doing.
Meanwhile, on the allegation of non-remittance of $20 billion,
the corporation in a statement by its Group General Manager,
Group Public Affairs, Mr. Ohi Alegbe, maintained that, what
was due for remittance to the Federation Account was the $
1.48 from the Nigerian Petroleum Development Company
(NPDC) signature bonus, taxes and royalties on the assets
transferred to the Corporation’s upstream subsidiary-NPDC
The Corporation noted that the release of the forensic audit
report has finally laid to rest the controversy surrounding
allegations of “missing oil revenue” or non-remittance to the
Federation Account.
NNPC explained that it was not true that it was indicted in the
Forensic Audit Report as being speculated in some quarters as
the $1.48 billion that the audit firm recommended the
corporation to remit to the Federation Account was not part of
the alleged unremitted revenues from crude lifting.
It explained that the $1.48billion was never in dispute as it is
made up of statutory payments such as signature bonus,
taxes and royalties which are statutory payments that come
with assets acquisition.
It stated that the delay in payment was due to the
reconciliation processes between the Department of Petroleum
Resources (DPR) and the NNPC.
In the same vein,the Minister of Petroleum Resources, Mrs.
Diezani Alison-Madueke, has directed NNPC to defray the
signature bonuses, taxes and royalties in line with the
recommendation of the forensic audit report.
The Corporation stated that the forensic audit report and the
Senate Committee on Finance report on the unremitted
revenue all alluded to the fact that NPDC reported crude oil
revenues of $5.11billion.
It further explained that the forensic audit acknowledged that
the total cash remitted into the Federation Accounts in
relation to the crude lifting in the period under review was $
50.81billion and not $47billion and that subsidy on premium
motor spirit and dual purpose kerosene stood at $8.7billion.
Expatiating further on the kerosene subsidy issue, the
corporation stated that the Forensic Audit Report also clarified
that subsidy on DPK was still in force as the presidential
directive of October 19, 2009, was not gazetted in line with
provisions of section 6 sub section 1 of the Petroleum Act of
1969.
The Forensic Audit Report also acknowledged that section 7
subsection 4 of NNPC Act empowers the corporation to defray
its costs and expenses including the costs of its subsidiaries
from crude oil revenues, though it also recommended that the
laws be reviewed to make the Corporation meet its costs and
expenses entirely from the value it creates.
It would be recalled that the Federal Ministry of Finance last
year contracted PriceWaterHouseCoopers, to investigate the
veracity of the allegation by the former Governor of the Central
Bank of Nigeria, Lamido Sanusi, that $48.9bn and later $20bn
was not remitted to the Federation Account by the NNPC.
Audit: PwC indicts NNPC, orders refund of $1.48bn tofederation account
Reviewed by Unknown
on
08:37
Rating: 5
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment
Every Amebocity.com User is responsible for anything he or she comments..the comment does not represent the views of Amebocity or any of its crew.