A report by the Auditor-General of the federation’s office has indicted the Nigerian National Petroleum Corporation Limited (NNPCL) in the diversion and misappropriation of public funds and non-timely remittance of revenue to the federation account in 2021.
The report, published in November, details cases of unauthorized deductions of N82.9 billion from the federation revenue for refinery rehabilitation and irregular deductions of funds valued at N343 billion from domestic crude sales at the source.
The OAuGF report observed that N343,642,598,726.51 was unilaterally deducted from the gross domestic crude sales as NNPC Value shortfall, Strategic Stock Holding Cost, Crude Oil, and Products Pipeline Losses, as well as the pipeline maintenance and management costs.
The corporation did not provide the details of each cost component for audit review, and the corporation’s management could not justify the reasons for the deductions.
The NNPCL management ought to have paid a net payable sum of N127,075,366,570.65 in May but only remitted the sum of N77 billion, leaving the sum of N50 billion largely unaccounted for.
According to the report, these anomalies are attributed to the weaknesses in the NNPC’s internal control system.
This deduction is a violation of the 2009 Financial Regulations and the OAuGF has advised the Group Chief Executive Officer of the NNPCL to provide reasons for the deductions, remit the funds to the federation account, and provide proof of remittance else stand a chance of facing sanctions relating to irregular payments and gross misconduct.
Similarly, the NNPCL was also indicted for the deduction of N82.9 billion from the sale of Crude Oil and Gas (Federation Revenue) from the 2020 and 2021 records for purported refineries rehabilitation.
This deduction was not supported with evidence of authorisation and approvals.
Following these revelations, the Socio-Economic Rights and Accountability Project (SERAP), a civil society organisation (CSO), directed the GCEO of NNPCL, Mele Kyari, to account for the misappropriated funds.
The Guardian earlier published a report detailing SERAP’s demands.
The CSO demanded that Kyari identify and hand over those suspected of involvement to the Independent Corrupt Practices and Other Related Offences Commission (ICPC) and the Economic and
Financial Crimes Commission (EFCC).
“According to the recently published 2021 audited report by the Auditor-General of the Federation (AGF), the Nigerian National Petroleum Company Limited (NNPCL) failed to account for over
N825 billion and $2.5 billion of public funds meant for refinery rehabilitation and repairs, and other oil revenues,” SERAP noted.
SERAP emphasized that Section 15(5) of the Nigerian Constitution 1999 (as amended) requires public institutions to abolish all corrupt practices and abuse of power.
[Guardian]