EZREL TABIOWO recalls the drama which followed the alleged claim by the CBN of the missing $10 billion oil money
How it started
Governor of the Central Bank of Nigeria(CBN), Sanusi Lamido Sanusi, in December 2013, accused the Nigerian National Petroleum Corporation(NNPC) of diverting $49.8 billion crude oil revenue. The governor had complained to President Goodluck Jonathan about the continuing refusal of the NNPC to honour its legal obligations, including failure to remit $49.8 billion to the Federation Account between 2012 and 2013. That amount represents 76% of the value of crude oil lifting during the period. The allegations were contained in a letter to the President dated 25 September 2013.
“Our analysis of the value of crude oil export proceeds based on the documentation received from pre-shipment inspectors shows that between January 2012 and July 2013, NNPC lifted 594,024,107 barrels of crude valued at $65,332,350,514.57,” the letter said.
Without any delay, the Senate mandated its committee on finance to investigate the authenticity or otherwise of the matter. During the first investigative hearing, the committee directed the NNPC, CBN and Finance Ministry to undertake reconciliation of monies remitted to the federation account.
The reconciliation move led to a revelation wherein the CBN boss admitted that $49.8 billion wasn’t missing but $10.8 billion$
During the next scheduled hearing, Sanusi recanted and told the lawmakers that the NNPC should be held responsible for the missing $20billion yielded from crude sales and yet to be remitted into the federation account.
But in a swift reaction, NNPC Group Managing Director, Andrew Yakubu, accused the CBN boss of being ignorant of the procedures of transaction employed by the corporation.
He said: “the issues that were raised are no new at all. You see we came out in details because we don’t have anything to hide and we gave a detailed breakdown of the so-called $49billion and we came out clearly state the various streams that are associated with what he was talking about.
“Now, we also made in clear that NPDC, if we had anything to hide, we would not have made it clear that NPDC was part of the stream, because NPDC which is NNPC’s upstream operation, is a limited liability company registered under the Companies and Allied Matters Act (CAMA) to do upstream business just like any other independent company.
“Now, if you are in your business, will you take your gross revenue and pass it on? What we simply said was to account for the streams that the CBN governor erroneously captured.
“Now let me make this point very clear. CBN is a banking outfit, so I really, really understand why they will not understand some petroleum engineering issues and they are not also an auditing outfit.”
Yakubu continued: “Now what they try to do is to audit and I heard some statements made here that they do not have this document, they don’t have that document. They are not the auditors. We have certified bodies and arms of agencies that are charged with the responsibility of auditing. They are banking right? So what he said was not really new. We said clearly that we stated an amount that went to NPDC and that amount was the gross lifting.
“But there are other streams that go back to government in terms of taxes just like any other business player. So we have Royalties, we have Petroleum Profit Tax and so on and so forth. Now these are subjects of other detailed discussions and investigations and they are open. We give access to the Auditor General of the Federation, we give access to Accountant-General, we give access to agencies that have business to do with auditing our own business.”
Independent forensic auditing
And just last week Thursday, the NNPC ‘accounted’ for the ‘missing’ $10.8 billion oil revenue just as Nigeria’s Finance Minister, Ngozi Okonjo-Iweala, called for an independent forensic audit of documents submitted by the Petroleum Products Pricing Regulatory Agency (PPPRA). The PPPRA had also at the hearing, submitted documents which certified spending and claims made by the NNPC in respect to the controversial oil fund.
The minister said: “On the oil finances, what is being said here, it is made to look as if there is no accountability and that is not the case. For two steady years, Federal Allocation Committee meeting, the ministry of finance ensured that the accounts of the country are transparently laid and every commissioner knows the details, they have their folders.
“It is the result of the reconciliation that we arrive at $10.8bn that everybody is now talking about. When CBN spoke about $49.8bn, we are the first to say it’s not correct. After that, it was proven that $49.8bn was not the right amount, the CBN had the courage to admit that it was actually $10.8bn it was the process employed by the ministry of finance that brought that about.”
“Without the steady work we have done to perfect the finances of this country, we won’t be talking about $10.8bn. The issue is that where is that money? How is it being accounted for? And we have led the process. We asked both the NNPC and the PPPRA to produce their documents and they had produced certified copies for the $10.8bn and we have asked for an independent audit. A lot of accusations are being made in this country and the only way to be satisfied is to have an independent audit.”
NNPC’s defence
Earlier, Engr. Yakubu had clarified all outstanding issues relating to the non-remittance of said amount by the corporation. According to him, a breakdown of the $10.8 billion said to be missing was spent on unpaid petroleum products subsidy totalling the sum of US$8.76 billion; Crude oil and products losses amounting to US0.76 billion; National strategic reserve holding cost amounting to US$0.46 billion; and pipeline maintenance and management cost amounting to US$0.91 billion.
Yakubu further told the committee that since January 2012, NNPC has not received any subsidy payments for petroleum products supplied to the domestic market, while adding that the N888.101 billion and N971.138 billion appropriated for subsidy for the year 2012 and 2013 respectively, were inadequate.
Also, the GMD further disclosed that during the period under review, NNPC lost 463,185,000 litres of PMS, 2,392,000 litres of DPK and 47,643,000 litres of AGO to pipepline vandalism, all amounting to US$296,047,770.15. Yakubu also added that the sum of $0.91 billion was incurred on pipeline and depot management and repairs.
Notwithstanding the seemingly logical submissions, the CBN still insisted that irrespective of whatever that must have happened, some amount still ought to have been remitted to the federation account.
With the Attorney General and Minister of Justice, Mohammed Adoke (SAN), takes the centre stage on Thursday, the submissions by all actors in this missing oil drama still call for further public scrutiny. While some analysts want to accuse the CBN boss of merely playing to the gallery, others are asking why it took the NNPC a CBN alarm to tell the world the financial loss suffered by the corporation prior to this time, to warrant such a huge loss. The reality however is that between NNPC and CBN’s claims, there is a missing link which must be squarely addressed. In other word, the investigation should go deep than it presently appears, hence the support for Okonjo-Iweala’s call for an independent forensic auditing.
