The Federation Accounts Allocation Committee, FAAC, has disclosed that the Nigerian National Petroleum Corporation, NNPC, is indebted to it, to the tune of $17,700,000, 000 (N5 trillion), over the last five years.
The NNPC is an agency under President Muhammadu Buhari, who doubles as the substantive minister of Petroleum Resources.
The debt, according to FAAC, was incurred between January 2011 and April 2016 and represents the outstanding gross revenue from the sales of domestic crude, which were not remitted to the federation account, but withheld by the national oil corporation.
The latest figure on NNPC’s indebtedness to FAAC, is contained in the special report prepared by FAAC’s post mortem sub-committee, a copy of which was made available on Sunday, July 10.
In the report, the committee noted that, while it had consistently directed NNPC to remit all revenues realized from domestic crude oil sales into the federation account, the corporation had always withheld part of the sales proceeds.
The post mortem subcommittee expressed concern about the lingering issue of unremitted crude oil sales to federation account by NNPC and demanded that a fresh forensic audit should be conducted on the accounts of the NNPC.
A peep into the report showed details of NNPC’s indebtedness to the federation account as follows: Between January and December 2011, NNPC was allocated crude volume in barrels totaling 170,632,246 valued at N2.7 trillion, while it made payment in the sum of N1.8 trillion, leaving gross outstanding revenue of N844.9 billion.
It was observed that in summary, the total debt, which the NNPC owes the federation within the period under review, amounted to N4.9 trillion. The second tranche of the corporation’s debt to the federation account covers transaction made in 2016.
According to the debt analysis report, in January 2016, a total of 12, 074,800 barrels of crude was allocated to the NNPC at the cost of N112.2 billion, but the corporation made a net payment of N85 billion, leaving an outstanding of N27.2 billion.
The subcommittee had consistently insisted that the NNPC should provide details of how much claims were expended as necessary condition for it to accept such claims, but the NNPC till date is yet to come up with such details.
“The NNPC had also insisted that the outcome of the forensic audit on the NNPC would reveal if the corporation owed the federation or vice versa. However, the just-concluded forensic audit covered a period up to December 2010 while the outstanding period covered by the subcommittee is from January 2011 to April 2016,” a member of the FAAC post mortem sub-committee was quoted to have said.
FAAC, which is the custodian of the federation account, is a body chaired by the Minister of Finance. Membership of the body includes the Commissioners for Finance, Accountants-General and Auditors-General from the 36 states of the federation and the Federal Capital Territory.
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