You may choose to call it the Buhari effect and you wouldn’t be wrong. Following the recent threat by the Nigeria president-elect, General Muhammadu Buhari to probe the alleged missing $20billion from the federation account, the federal government under president Goodluck Jhonathan has now made public the findings of PricewaterhouseCoopers Limited (PwC), the company contracted to carry out a forensic Audit Report on missing funds in NNPC.


Brief Summary Findings

Based on the work conducted by our team from the commencement of this mandate up until 29 January 2015, our conclusions are as follows;
* Total gross revenues generated from FGN crude oil liftings was $69.34bn and NOT $67 billion as earlier stated by the Reconciliation Committee for the period from January 2012 to July 2013.

* Total cash remitted into the Federation accounts in relation to crude oil liftings was $50.81bn and NOT $47bn as earlier stated by the Reconciliation Committee for the period from January 2012 to July 2013.

* NNPC has provided information on the difference leading to a potential excess remittance of $0.74 billion (without considering expected remittances from NPDC). Other indirect costs of $2.81billion which were not part of the submission to the Senate Committee hearing have been defrayed to arrive at this position.

* The resulting potential excess remittance indicates that the Corporation operates an unsustainable model. Forty six percent (46%) of proceeds of domestic crude oil revenues for the review period was spent on operations and subsidies. The Corporation is unable to sustain monthly remittances to the Federation Account Allocation Committee (FAAC), and also meet its operational costs entirely from the proceeds of domestic crude oil revenues, and have had to incur third party liabilities to bridge the funding gap. Furthermore, the review period recorded international crude oil prices averaging $122.5 per barrel (Average Platts prices for 2012). As at the time of concluding this report, international crude oil prices average about $46.07 per barrel, which is about sixty two percent (62%) reduction when compared to the crude oil prices for the review period. If the NNPC overhead costs and subsidies are maintained (assuming crude oil production volumes are maintained), the corporation may have to exhaust all the proceeds of domestic crude oil sales, and may still require third party liabilities to meet costs of operations and subsidies, and may not be able to make any remittances to FAAC.

* We therefore recommend that the NNPC model of operation must be urgently reviewed and restructured, as the current model which has been in operation since the creation of the Corporation cannot be sustained.

* The report reflects the fact that $3.38 billion was spent on DPK subsidy for the review period. We also confirmed using third party vessel tracking platforms that all vessels carrying NNPC cargoes arrived in Nigeria within the periods disclosed by PPPRA.

* A major consideration centers on the ownership of oil and gas assets controlled by NPDC. Subject to additional information being provided, we estimate that the NNPC and NPDC should refund to the Federation Account a minimum of $1.48billion as summarised in the next page.

* A determination is required as to whether all or a portion of ‘other costs not directly attributable to crude oil operations can be defrayed by NNPC.

* Other Findings
For the period reviewed, we identified possible errors in the computation of crude oil prices at the NNPC that resulted in a $3.6 million shortfall in incomes to the Federation account. The major beneficiaries were Fujairah Refinery – $805,545, NNPC (KRPC/WRPC) – $697,995 and NNPC (COMD) – $2,107,275. Subsequent to our identification of this issue, NNPC has amended the errors, and have reflected the amendments in the remittances to FAAC in October 2014.

* Our review of the DPK sales process revealed that NNPC sells DPK to bulk DPK marketers in Nigeria at N40.90 per litre at a location on the coastal waterways (off shore Lagos). The expected/official regulated retail price of DPK in Nigeria is N50 per litre. This retail price of N50 comprises the Ex-depot price of N34.51 and a Margin of N15.49. NNPC should be required to explain the reason for selling DPK at N40.90, rather than the regulated Ex-depot price of N34.51. The Corporation should also be required to explain the reason for selling DPK to bulk DPK marketers at a location on the coastal waterways (off shore Lagos) rather than at the in-country depots.

NNPC explained that the contract the Corporation executes with the kerosene marketers confirms NNPC (PPMC) is responsible for the delivery of DPK to marketers at their assigned depots on shore. The Corporation further explains that the kerosene marketers however opt to receive the product off shore Lagos.
The Corporation further explains that the DPK sales price per litre off shore Lagos includes the following:

Approved sales price 34.51
Bridging allowance 5.85
Marine Transportation Allowance 0.15
PPPRA Admin Charge 0.15
Total 40.66
Unexplained charge 0.24
Sales price off shore Lagos 40.90

View and download full report below;

Download (PDF, 12.1MB)
Source: http://360reporters.com/2015/04/breaking-full-text-of-nnpc-forensic-audit-report-exposes-how-billions-of-dollars-was-stolen-from-nigeria/

Story for the gods

Making this kind of document public is not good for the interest of the Country

Meanwhile, IF buhari want NNPC Probe, who will probe his Fake Certificate issue

Yinmu

Omo the situation within NNPC Oga at the top will be so now because breez of change go soon blow and NNPC fowl yansh go show

i can't really see the difference in the figures given by the NNPC and the one by the audit group. It's just a miserable #1b change which the figures can be reconciled.

segzyj:
Story for the gods

Making this kind of document public is not good for the interest of the Country

Meanwhile, IF buhari want NNPC Probe, who will probe his Fake Certificate issue

I believed i told u before march 28 general elections that ur brains are infected with virus. Now that the elections are over u dont want to go and get a cure.

satelliteDISH:

I believed i told u before march 28 general elections that ur brains are infected with virus. Now that the elections are over u dont want to go and get a cure.

TFYF