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Saturday, 14 December 2013

Non Remittance of $49.8b: NNPC Accuses CBN of Spreading Deliberate Falsehood

The stage seems set for a media war between the Nigeria National Petroleum Corporation NNPC and the Central Bank of Nigeria, two very vital economic arms of the Nigerian economy.

The issue?- alleged non remittance of $49.8 billion dollars into the Federation account, an allegation that was made by the Governor of CBN, Mallam Sanusi Lamido Sanusi in a letter to President Goodluck Jonathan on the 25th of September 2013, which eventually got out to the media space.

The management of NNPC irked by the allegation called a Press Conference n Abuja where it tried to explain what it called "the real facts" of the matter.

Group Managing Director of NNPC, Andrew Yakubu insisted that the CBN Governor was deliberately feeding the President and Nigerians false information in a bid to smear the already battered image of the country's National oil company.

He further described the CBN allegation as unfounded and baseless because the apex bank has always been a major player in the oil and gas value chain.

The NNPC GMD noted that the Corporation  was not a sole player in remitting revenues accrued to the Federal Government adding that the CBN, Federal Inland Revenue Service and the Department of Petroleum Resources are part of the major players in the sector that meet on a monthly basis to reconcile the records of oil lifting and payments.

“In fact our data was compiled from signed up documentation. I will not say the CBN was not aware because they are always at the meeting and they also sign up the documentation and reconciliation documents” he said.

According to him, “I want to say clearly that the allegation is unfounded, it is baseless and it has become a political instrument in the current politically charged environment. And I will consider it as an attempt to ridicule NNPC staff and the management of NNPC.

The Group managing Director of NNPC  also said “The statement credited to the CBN Governor that NNPC has failed to remit the sum of $49.8bn representing 76% of total national oil receipts is borne out of a surprising lack of understanding of how revenues from crude oil sales are remitted into the Federation Account.

“I will therefore explain the process and put the figures in perspective in order for you to understand and let the world know that NNPC is not in the business of withholding any crude oil receipts due the Federation Account or any other statutory remittances.”

Yakubu explained further that “”all NNPC crude oil liftings are made up of the following; Equity Crude, Royalty Oil,Tax Oil,Volume for Third Party Financing, and NPDC equity volume. “It is important to stress that remittances of proceeds from the above liftings are made according to statutory and production arrangements.

“Accordingly, proceeds from Equity crude is paid by NNPC into the Federation Account which is held by the Central Bank of Nigeria. Proceeds from Royalty oil is paid to Department of Petroleum Resources, DPR, whose designated account is managed by the same CBN.

“Similarly, the proceeds from Tax Oil or Petroleum profit Tax lifted by NNPC is paid directly into the Federal Inland Revenue Service, FIRS, account also managed by the CBN.

“It should now be clear to all that NNPC is by statutory requirement responsible for direct remittances of only one stream of liftings, namely Equity Crude.”

“Analysis of the figures is as follows; the CBN letter claims that for the period 1st Jan 2012 to 31st July 2013, total National crude oilliftings was 1.287 billion barrels. Our records show that the total national crude lifting for the same period was actually higher at 1.330 billion barrels. Furthermore, total NNPC liftings during the same period was again higher at 618.552 million barrels as against the 594.024 million barrels stated by CBN.

“We further wish to state that the proceeds from the total NNPC liftings comprising Federation Equity, Royalty Oil, Tax Oil, Volume for Third Party Finance and NPDC equity amount to US$67.12bn as against the $65.33bn that the CBN stated.

“NNPC remitted its portion which is $18.48bn (27.5%) into the Federation Account being the total proceeds from Equity Crude and gas sales of which CBN acknowledged receipt of $15.528bn (24%).
At this point, we wish to categorically state that all the proceeds from NNPC have been remitted as statutorily required.

“On the issue of US$49.8 billion or 76% of total national liftings and the alleged unremitted funds, we would like to clarify that this represents the balance of other streams as stated above. These, as I stated earlier, are remitted to the various Agencies which are statutorily empowered to collect and remit same into the Federation Account.

The Group Managing Director of NNPC also reacted to CBN's allegation that the Corporation owes the Federal Government 22 billion naira being levies owed the Nigeria Export Supervision Scheme NESS.

“The current position is that NNPC has paid a total of $114.78 million from inception of NESS in 2009 up to October 2013 as against the total, budget of $117.08 million for the same period. These payments have been reconciled with the CBN, who are again the custodians of the NESS account that is operated on a draw-down basis by the CBN.

“NNPC hereby states that in carrying out our statutory duties we will continue to maintain the highest level of transparency and accountability. Please be assured that NNPC remains available at all times to provide clarifications on these issues or any other matter relating to our responsibility to the Federation and the Nigerian people" he concluded.

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