The Nigerian National Petroleum Corporation (NNPC) failed to remit $16.8billion it earned as a dividend for its 49 per cent stake to the Federation Accounts in 16 years, says the Nigerian Extractive Industries Transparency Initiative, (NEITI) in its just-released 2015 audit report.
NNPC maintains that it has authorization from the presidency to hold the dividends in trust and utilize as directed by the government but NEITI wants it to provide documentary evidence of the authorization to hold the money in trust and to give an account of the expenditure from and the status of the $16.8 billion collected in 16 years.
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In 2015, the Nigeria Liquefied Natural Gas Limited (NLNG) paid $1.07 billion as dividend, interest and loan repayment to NNPC, broken down as follows: $1.04 billion as dividends, $3.1 million as interests, and $29.1 million as loan repayment. This brings to a total of $16.8 billion NLNG’s payments to NNPC for the period 2000 to 2015. The payments are for the loan grant to NLNG and for the 49% stake that the government holds in the company.
“While NNPC has always confirmed receipt of the payments, it has never shown evidence of remittance to either the Federal Government or to the Federation Account,” NEITI says in a statement.
This continues a pattern of non-remittance that continues despite several invitations by the national assembly for heads of the NNPC to explain reasons for non-remittance. This practice continues unabated. Last year, NEITI said that between 2000 and 2014, the NNPC had received as $15.8billion as dividend but there was no evidence that it remitted same to the Federation Account.
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“Beyond providing a snapshot of what transpired in 2015, this report reveals money to be recovered, leakages to be blocked, and urgent reforms to be undertaken,” said Waziri Adio, the Executive Secretary of NEITI, at the release of the report today. “The most critical takeaway is the need to expedite, expand and sustain reforms in this still critical sector of national life.”
NLNG dividends and loan repayments are a major source of revenue loss to the federation and NNPC, as custodian of the country’s shares in the NLNG, received her share of the dividends but often does not explain why they are not remitted to the Federation Account.
In the report Friday, NEITI also said that Nigeria’s oil and gas revenues plunged from $54.5 billion in 2014 to $24.8 billion in 2015, while the country’s oil production fell from 798 million barrels in 2014 to 776 million barrels in 2015.
According to the NEITI 2015 Oil and Gas Industry Audit Report, the total outstanding revenue from the sector as at 2015 was $3.7 billion and N80 billion, while losses incurred stood at $2.2 billion and N60 billion, and unreconciled revenues amounted to N317 billion.
