6 December 2017

Nigeria: Reps Order NNPC, NPDC to Pay U.S.$1.5 Billion Three-Year Royalties

Abuja — The House of Representatives ad-hoc committee investigating over N1.6trillion revenue leakages yesterday asked the Nigerian National Petroleum Corporation (NNPC) and Nigeria Petroleum Development Company (NPDC) to clear $1.5billion unpaid royalties on oil and gas activities.

The debt, the committee said, was accumulated over three years.

NPDC, an exploratory arm of the NNPC, has been dubbed by the Department of Petroleum Resources (DPR) as the worst defaulter amongst the oil companies operating in Nigeria for failing to pay the royalties.

At a hearing on the matter, members of the panel led by Jarigbe Agom Jarigbe (PDP, Cross River) disagreed with the NNPC and NPDC on a payment plan of $10 million monthly agreed with the DPR, asking why the money was allowed accumulate.

The Chief Operating Officer (COO) Upstream of the NNPC, Mr. Bello Rabiu told the panel that though NNPC set up the NPDC, it ‎was fully an independent entity, adding that the non-payment of the royalties was not the making of the current management of both entities.

The Managing Director of NPDC Mr. Yusuf Matashi said the debts piled up due to failure of the company's strategic partner, Atlantic Energy, to pay its liability. He said a case on the matter was in court and it would be subjudice to treat it in public.The lawmakers who insisted NPDC pay the royalties disagreed with his submission.

They expressed disappointment that NPDC, a government entity, would starve the government of needed funds in an economy that just experienced recession, and a budget deficit of over N2trillion that would be financed by borrowed funds.

The panel also engaged chief executive officers of international oil companies (IOCs) who took turn to give updates on their interface with the DPR with a view to reconciling differences on royalty payment.

The House of Representatives yesterday directed its committee on capital market and institutions to investigate conflicts between Minister of Finance Kemi Adeosun and the suspended Director General, Security and Exchange Commission (SEC), Mr. Munir Gwarzo.

The lawmakers urged both parties to maintain status quo pending the outcome of the investigation.

The House also mandated its committee on power to investigate the interim management of the Transmission Company of Nigeria (TCN) for the delay in the execution of $300 million Nigeria Electricity and Gas Improvement Project (NEGIP).

The resolution followed the adoption of a motion by Yunusa Abubakar (Gombe-APC) in which he said the TCN had not been able to implement the NEGIP project.

Nigeria

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