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Concerns Mount Over Unremitted $50bn, Crude Oil Swaps - Politics - Nairaland

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Concerns Mount Over Unremitted $50bn, Crude Oil Swaps by Pukkah: 2:58pm On Dec 16, 2013
The furore raised by a letter written by the Governor of the Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi, to President Goodluck Jonathan notifying him of the non-remittance by the Nigerian National Petroleum Corporation (NNPC) of crude oil proceeds amounting to $49.8 billion into the Federation Account shows no sign of abating with industry experts calling for a comprehensive audit of NNPC’s operations.

They have also called for the establishment of a technical committee comprising the Federal Ministry of Finance, NNPC, CBN, Department of Petroleum Resources (DPR), Federal Inland Revenue Service (FIRS) and representatives of the auditors general of the 36 states of the federation, among other relevant stakeholders, to undertake a proper reconciliation of crude lifting and sales proceeds by NNPC and oil companies, identify revenue leakages and implement fiscal controls to plug the leakages.

Speaking on the issue at the weekend, officials of the Nigerian Extractive Industries Transparency Initiative (NEITI) and International Oil Companies (IOCs) warned that it would be dangerous for the federal government to ignore the serious concerns raised by Sanusi and attempt to obscure the issues under the guise that it was politically motivated.

“What Sanusi wrote was not new. Remember that in our 2011 report on the industry, NEITI raised the alarm over revenue shortfalls of N3.2 trillion.

Similarly, Nuhu Ribadu, in his report on the industry last year, raised a similar issue, stating some $30 billion could not be accounted for.

“Yet all these issues were ignored and swept under the carpet, while NNPC always embarks on media war to obfuscate the issues. But we can no longer continue like this, otherwise the economy will collapse,” the NEITI official warned.


He said he had studied Sanusi’s letter carefully and noted that the addendum indicating crude lifting, sales proceeds and actual remittances was quite revealing.

“If you notice in the data provided by the CBN governor, it showed that total national crude oil lifting over the 19-month period was 1,287,742,641 barrels as provided by pre-shipment inspectors. This comes to an average of 67.7 million barrels a month that was lifted from the country from January 2012 to July 2013.

“A further breakdown showed that Nigeria exported on average 2.29 million barrels per day (mbpd), and when this is multiplied by the average crude oil price of $110 per barrel, total national crude proceeds would come to $142 billion as shown by CBN.

“Of the total national crude oil lifting, NNPC exported 594,024,107 barrels or an average of 31.26 million barrels a month as its share of equity crude. But of the amount, NNPC was only able to repatriate $15.528 billion into the Federation Account and has insisted since Sanusi’s letter was made public that the revenue shortfall of $49.8 billion was remitted into the Federation Account by DPR and FIRS as royalties and petroleum profit tax respectively,” he explained.

He said this could not be true as it was obvious that there were considerable leakages in the crude oil lifting and sales regime, which had outweighed the oil theft and deferment caused by vandalism to pipelines and oil facilities.

According to him, “If you add what NNPC has repatriated, that is, $15.528 billion and the shortfall of $49.8 billion, what this implies is that Nigeria is only making earnings from an estimated 40 per cent of total national crude oil lifting and sales, and this is impossible as Nigeria should get a lot more.”

The NEITI official also demanded to know how much of the $49.8 billion was actually paid into the Federation Account by DPR and FIRS as claimed by NNPC.

He further sought to know the breakdown paid by the IOCs, indigenous oil firms and NNPC, stating, “We are not even certain NNPC pays its share of PPT and royalties from its equity crude because when the IOCs are asked, they provide conflicting figures from those submitted by NNPC.”

When reminded that there is a Modified Carrier Agreement (MCA) for Joint Venture operations (JVs) and that the corporation also takes out 445,000 barrels per day (bpd) for domestic refining, and these may account for the drop in NNPC’s equity crude oil lifting and sales to 40 per cent, the NEITI official maintained it is in these areas the leakages are most prevalent.

http://www.thisdaylive.com/articles/concerns-mount-over-unremitted-50bn-crude-oil-swaps/166689/
Re: Concerns Mount Over Unremitted $50bn, Crude Oil Swaps by Pukkah: 3:01pm On Dec 16, 2013
In addition, the NEITI official drew THISDAY’s attention to revenue leakages arising from the operations of the Nigerian Petroleum Development Company (NPDC), the exploration and production subsidiary of NNPC.
He recalled that Shell, Agip and Total had sold their 45 per cent equity interest in at least six oil blocks, which NNPC had insisted on transferring the operatorship of the said blocks to NPDC.

“Meanwhile, NPDC lacked the technical or financial capacity to operate these oil mining leases (OMLs). So what it did was to turn around to appoint two local oil firms with no track record in the upstream oil and gas sector under a shoddy financing arrangement for the six OMLs.

“From investigations, all the two firms did was to put down $50 million, which has enabled them lift up to 60 per cent of NPDC’s crude oil under the cost recovery programme.

“It is the likes of such firms that Sanusi referred to in his letter when he drew the attention of the president to the bureau de change (BDCs) that have purchased several hundreds of millions of naira from the interbank market, but were unable to account for these monies.

“This is clearly a case of money laundering by persons with links to the oil and gas sector, and this was the reason behind the withdrawal of 20 BDC licences last September by the CBN,” he revealed.



He insisted that the audit of NNPC’s operations had become imperative, but felt that PricewaterhouseCoopers (PWC), which had already been appointed by the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, should be reinforced with the appointment of an extra independent audit firm to scrutinise the books of the corporation.

“Under the NNPC Act, it is meant to be audited annually but NEITI has never been given access to its accounts. This is unacceptable for a national oil company,” he said.
Re: Concerns Mount Over Unremitted $50bn, Crude Oil Swaps by superstar1(m): 3:06pm On Dec 16, 2013
Sanusi is a liar. He doesn't understand the technical workings of NNPC. Just the same way RIbadu and NEITI never understood it in 2011. The 3 of them are unpatriotic, should be arrested and charged with treason. They are pro-APC> They are in alliance with North and south west against Mr president. You will all fail. grin grin grin grin grin grin grin grin grin grin grin

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Re: Concerns Mount Over Unremitted $50bn, Crude Oil Swaps by Pukkah: 3:11pm On Dec 16, 2013
superstar1: Sanusi is a liar. He doesn't understand the technical workings of NNPC. Just the same way RIbadu and NEITI never understood it in 2011. The 3 of them are unpatriotic, should be arrested and charged with treason.

But do you realize that the NEITI officials are backing Sanusi and Ribadu's reports?

Can you let us have someone that 'better' understands the workings of the NNPC to disprove what all these are saying?
Re: Concerns Mount Over Unremitted $50bn, Crude Oil Swaps by bloggernaija: 9:01pm On Dec 16, 2013
“Meanwhile, NPDC lacked the technical or financial capacity to operate these oil mining leases (OMLs). So what it did was to turn around to appoint two local oil firms with no track record in the upstream oil and gas sector under a shoddy financing arrangement for the six OMLs

Patience is written all over that one
Re: Concerns Mount Over Unremitted $50bn, Crude Oil Swaps by MeAboki(m): 6:41am On Dec 17, 2013
^^^^ The woman no dey carry last for corruption according to this link.

http://thewillnigeria.com/opinion/19109.html

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