The recently concluded forensic audit carried out by PriceWaterhouseCoopers on unremitted funds due to the Federation Account has indicted the Nigerian National Petroleum Corporation and the Nigerian Petroleum Development Company.
Both organisations are to refund at least $1.48 billion to the Federation Account.
The highlights of the report, released by the Auditor-General of the Federation, Samuel Ukura, on Thursday in Abuja, showed that the total gross revenue generated from crude oil liftings was $69.34 billion and not $67 billion as bandied in some quarters, including the Senate Reconciliation Committee, for the period from January 2012 to July 2013.
It said that within the $69.34 billion, $28.22 was the value of domestic crude oil allocated to NNPC and the total amount spent as subsidy for Premium Motor Spirit, otherwise known as petrol, amounted to $3.38 billion.
Also, the total amount spent as subsidy for DPK (not appropriated) amounted to $3.38 billion, while the total other third party financing arrangement and equity crude oil processing costs amounted to $1.19 billion.
Similarly, the report said that the total cost directly attributable to domestic crude oil amounted to $1.46 billion, whereas other costs incurred by the corporation not directly attributable to domestic crude oil was $2.81 billion.
“Revenue attributable to NNPC as submitted by the former NPDC Managing Director to the Senate hearing (less PPT and Royalty paid) is $5.11 billion,” the report said.
PriceWaterhouseCoopers stated that this amount needed to be incorporated into the financial statements of the NPDC from where dividend should be declared to the Federation Accounts, while signature bonus, PPT and Royalty yet to be paid by NPDC is $2.22 billion.
Total cash remitted into the Federation Accounts in relation to crude oil liftings was $50.81 billion and not $47 billion as earlier stated by the Senate Reconciliation Committee for the period from January 2012 to July 2013.
Based on the information available to PriceWaterhouseCoopers and from the analysis, the audit firm submitted that NNPC and NPDC should refund to the Federation Account a minimum of $1.48 billion.
In addition, PriceWaterhouseCoopers recommended that the NNPC model of operation must be reviewed and restructured as the current model, which had been in operation since the creation of the corporation, could not be sustained.
It will be recalled that the Federal Government, last year, appointed PriceWaterhouseCoopers, an international audit firm, to conduct a forensic audit of NNPC after the former Governor of the Central Bank of Nigeria, Alhaji Sanusi Lamido Sanusi, had written a letter to President Goodluck Jonathan over the non-remittance of $49.8 billion to the Federation Account by the corporation between January 2012 and July 2013.
The revelation led to an unprecedented uproar among Nigerians.
Sanusi revised the amount from $49.8 billion to $10.8 billion and later to $20 billion.
Meanwhile, the NNPC has said the forensic audit report on the alleged missing $20 billion unremitted oil revenue carried out by the reputable international firm, PriceWaterhouseCoopers, has absolved it of culpability over the allegation of non-remittance of $20 billion.
It said what is due for remittance into the Federation Account is $1.48 billion from the Nigerian Petroleum Development Company, being signature bonus, taxes and royalties on the assets transferred to the corporation’s upstream subsidiary.
In a statement made available to journalists, the corporation said the release of the forensic audit report had laid to rest the controversy surrounding allegations of “missing oil revenue” or non-remittance to the Federation Account.
The corporation explained that it was not true that it was indicted in the Forensic Audit Report as being speculated in some quarters, as the $1.48 billion that the audit firm recommended the Corporation should remit to the Federation Account was not part of the alleged unremitted revenues from crude lifting.
It explained that the $1.48 billion was never in dispute, as it was made up of statutory payments such as signature bonus, taxes and royalties.
It said the statutory payments came with assets acquisition.
It stated that the delay in payment was due to the reconciliation processes between the Department of Petroleum Resources and the NNPC.
Meanwhile, the Minister of Petroleum Resources, Diezani Alison-Madueke, has directed the NNPC to defray the signature bonuses, taxes and royalties in line with the recommendation of the forensic audit report.
The corporation stated that the forensic audit report and the Senate Committee on Finance report on the unremitted revenue alluded to the fact that NPDC reported crude oil revenues of $5.11 billion.
It further explained that the forensic audit acknowledged that the total cash remitted into the Federation Account in relation to the crude lifting in the period under review was $50.81 billion and not $47 billion and that subsidy on premium motor spirit and dual purpose kerosene stood at $8.7 billion.
Expatiating further on the kerosene subsidy issue, the corporation stated that the Forensic Audit Report also clarified that subsidy on DPK is still in force as the presidential directive of October 19, 2009 was not gazetted in line with provisions of Section 6, Sub-section 1 of the Petroleum Act of 1969.
The Forensic Audit Report also acknowledged that Section 7, Sub-section 4 of NNPC Act empowers the Corporation to defray its costs and expenses, including the costs of its subsidiaries from crude oil revenues, though it also recommended that the laws be reviewed to make the Corporation meet its costs and expenses entirely from the value it creates.
It will be recalled that the Federal Ministry of Finance last year hired the PriceWaterHouseCoopers to investigate the veracity of the allegation by Sanusi that $48.9 billion, but later $20 billion, was not remitted to the Federation Account by the NNPC.
Nigerian Tribune.
Forensic audit: NNPC, NPDC to refund $1.48b to Federation Account
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