Executive Secretary of the Nigeria Extractive Industries Transparency Initiative, NEITI, Waziri Adio says Nigeria is only sure of the amount of crude oil it exports, but has no record of the quantity it produces.
This is as Senate set up an ad-hoc committee to investigate the NEITI report
Adio, who was speaking at his presentation on the NEITI 2013 audit report at the Senate chamber on Wednesday, explained that lack of accurate information on the actual quantity of crude oil Nigeria produces was compounded by the absence of a proper metering system.
“In 2013, the country produced 800.3 million barrels and out of that the country made $58.07 billion, and that represents an eight percent reduction on the $62.9billion that the country made in 2012,” he said.
“The second issue is that there are some monies that were withheld, lost or underpaid for different reasons.
“These monies are in three tranches. The first is in the category of the unremitted, and the unremitted amounted to $3.8billion and N358million.
“The second category is the category of losses, because of some inefficient practices and theft among other things, the country lost $5.9billion and N20billion.
“Under the category of the under-assessed, the country lost $599.8million.”
He said the unremitted $1.7billion was still being owed the federation for OMLS.
“Also, $1.29 billion from the NLNG dividends and N351billion from unpaid domestic crude debt, N2.17billion from cash calls refunds,” he said, adding that those were the monies “we have established that should have been paid to the federation and were not paid.
“The second category of losses is by NNPC and its subsidiaries. Out of the $5.9billion, N4.7 billion was lost to theft and vandalism,” Adio said.
He added that “N20billion was lost because the NNPC did not observe the 90 days credit grace and when you look at the time value of money, if you calculate at 12 percent interest the country lost N20billion.
“Some of the issues in the report, the first is about the assets divested by NNPC to NPDC. NNPC between 2010 and 2011 divested eight assets that belong to the federation to its upstream subsidiary, NPDC. So NNPC divested 55 percent of the shares being held on behalf of the federation to the NPDC.
“These eight OMLS are valued at $1.8billion by DPR. NPDC paid only $100millio out of the $1.8billion, meaning there is an outstanding of $1.7 billion, and even that $100million was paid two years after.
“What this means is that NNPC lifted oil on behalf of NPDC not on behalf of the federation, despite the fact that NPDC has not fully paid for those assets.
“Another issue that came out of the audit is the NLNG dividend. NLNG in 2013 paid $1.28 billion, but the money was not remitted to the federation account.
“Beyond this, between 2005 and 2013, NLNG paid $12.9billion to NNPC and NNPC acknowledged receiving it, but the money was not remitted to the federation account.
“Another is the losses incurred from swap and OPA. This is the arrangement where NNPC exchanges crude for product and the country lost $518million due to the inefficiency of the swap and OPA.
“$211million was lost to product swap and $306million was lost to OPA.
“N1.3trn was posted for petroleum subsidy in 2013. It was 30 percent higher than the total for budget education, health, water and SURE-P.
“We found out that we have infrastructural deficit – the country can only say what it exports and cannot say authoritatively what it produces.
“This has always been an issue and the audit confirms that we still don’t have metres where we should have them.
“This lack of metering has serious implication for revenue and national security.”
Senate President Bukola Saraki reacting to the revelations said, “Based on the fact that the issues we talked about cut across a lot of different standing committees, and in view of the enormity involved, the general opinion is that we will set up an ad-hoc committee with the responsibility of addressing them, with the terms of reference to re-examine the financial processes and the fiscal audit report of the NEITI; the financial loss and leakages to government and all its ramifications, remedial measures and sanctions where necessary, and of course, more importantly, any relevant legislative action that would be required to block all forms of leakages.
“For the membership of the ad-hoc committee, we have Senator Tayo Alasoadura, who is the chairman (Upstream), Senator Bassey Akpan, who is the chairman, Gas; Senator Andy Uba, chairman, Public Accounts, Senator John Enoh, chairman, Committee on Finance; Senator Jibrin Barau, chairman, Downstream, and Senator Chukwuka Utazi, chairman, Committee on Anti-Corruption.”
Other members are Senator Kabir Marafa, Senator Solomon Adeola and Senator Bukar Mustapha.
The committee will be chaired by Senator Jubrin Barau, with Senator Andy Uba as the vice chairman.
“This committee is given a short period of time of four weeks to complete its assignment and report back to us,’’ Saraki said.


Ad:See How you can turn $500 into $10,000 Click HERE For Details.
SHARE