22 May 2019

Nigeria: NNPC Remits N1.26 Trillion to Federation Account in 2018

The Nigerian National Petroleum Corporation (NNPC) said its remittances to the Federation Account in 2018 exceeded its projections in the 2018 budget by about N41 billion.

The NNPC said in a statement on Tuesday that it remitted N1.26 trillion as against the N1.22 trillion projected in the 2018 budget.

The Managing Director of NNPC Capital, Godwin Okonkwo, who represented the Group Managing Director, Maikanti Baru, disclosed this during a presentation to the House of Representatives Ad Hoc Committee on the Investigation of the Non-Remittances of Funds to the Federation Account by the corporation between July 2017 and December 2018.

NNPC spokesperson, Ndu Ughamadu, quoted the GMD as saying that though 2.3 million barrels per day (mbpd) was proposed in the 2018 budget, national daily production for the period under review averaged between 1.9mbpd and1.89mbpd.

Mr. Baru listed the two sources of inflows into the Federation Account from the NNPC to include equity crude oil sales less cost of recovery from the Joint Venture cash call arrears and domestic crude less cost of recovery.

He said the Joint Venture cash call arrears were being efficiently managed to ensure steady inflows to the Federation Account.

"The current management of NNPC ensures it contributes to the cost of the production of crude oil and gas in the upstream sector to avoid a repeat of the mistakes of the past. If we had made cash call payments in the past, the arrears we are liquidating now would not have arisen.

"The current situation creates a win-win scenario for the country. The NNPC is strategically saving for the rainy day to make a better future for all of us by liquidating the arrears," Mr Okonkwo said.

He said the NNPC on a regular basis balanced its books with the Federation Account Allocation Committee (FAAC) and the JV cash calls in order to make sure that the future generations do not suffer from the legacy debt.

He dismissed the allegations by commissioners of finance of underremittances by the corporation, adding that the NNPC was a going business concern that met financial obligations to its various stakeholders.

Mr. Baru said investment in the Oil and Gas Industry took time to mature, adding if the NNPC failed in its obligation to invest in the sector, there would be nothing to share by the various tiers of government.

On a question on whether the NNPC 2018 audited account was ready, Mr. Baru said the 2018 audited account would be ready next month.

He said the NNPC had cleared its backlog of unaudited account, attributing the delay to some Joint Venture partners that were being awaited to turn in their budget performance for the 2018 budget circle to be completed.

The Chairman of the Ad Hoc Committee, Chukwuka Onyema Wilfred, praised the NNPC for responding to all the issues raised, adding that the interface would go a long way to putting to rest allegations of non-remittances of funds against the NNPC.

Nigeria

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