SEC targets trillions of naira from interest-free capital market

By Aduragbemi Omiyale

The Conference of Nigerian Political Parties (CNPP) has cast doubts on the after-tax profit of 674 billion naira declared by the Nigerian National Petroleum Company (NNPC) Limited on Tuesday during the financial year 2021.

In a statement released on Wednesday, the group called for an independent investigation into NNPC’s management and board members over the past seven years.

The Group Managing Director of NNPC Limited, Mr. Mele Kyari, yesterday informed reporters during a press briefing in Abuja that the organization improved its net profit by 135% from the 287 billion naira of the last year.

“It is difficult for NNPC Limited to convince patriotic Nigerians that its reported earnings in two years are not manipulated,” CNPP said in a statement signed by its secretary general, Mr. Willy Ezugwu.

“CNPP calls for a proper investigation of NNPC’s corporate management and board of directors over the past seven years, especially those who approved the 2021 audited financial statements, stating that NNPC has achieved the unimaginable 134.8% year-on-year earnings growth in 2021.

“To highlight a few reasons why the profits reported annually by the NNPC since 2020 are highly questionable, we note that in 2017, Nigerian lawmakers uncovered alleged oil and gas revenues of $15 billion.

“The alleged revenue leak was exposed by the House of Representatives ad hoc committee investigating the missing $17 billion in crude oil and liquefied natural gas revenue when the committee discovered the $15 billion in missing revenue. paid into the account of the Federation.

“According to the House Committee, a trace of the allegedly missing fund, which was allegedly stolen and diverted to a foreign destination, was contained in two documents submitted by the Nigerian National Petroleum Corporation, NNPC, during the committee session.

“To date, no one has been prosecuted and no one has been fired.

“Again, in 2018, NNPC reported that N4 trillion naira had not been disbursed as revealed in the 2016 audit report stating that some revenue collection agencies of NNPC and the DPR did not post any income to the Federation account for a few months, no explanation was given why these months saw no income.

“The audit report highlighted some of the findings of the auditor, stating that the total unremitted revenue as of January 1, 2016 from amounts payable to the Federation account by NNPC was 3,878,955 ₦039,855.73 (i.e. three trillion eight hundred seventy eight billion, nine hundred fifty five million thirty nine thousand eight hundred fifty five naira).

“In addition, the sum of N1,198,138,355,860.30 was due in revenue to the Federation account out of the total generated in 2016. However, NNPC paid the sum of N1,000,545,058,966.2 which resulted in a holdback of N197,593,296,894.02. This brought the total amount withheld by NNPC from the Federation account as of December 31, 2016 to N4,076,548,336,749.75,” CNPP said.

The apex body of all registered political parties and political associations in Nigeria then blamed the “NNPC management for its inability to keep accurate records, let alone make huge profits as it has claimed since the year of pandemic 2020.

“For example, it was reported that NNPC did not clearly state the amount of crude oil transported or delivered to Warri Refinery and Petrochemical Company (WRPC) and Kaduna Refinery and Petrochemical Company (KRPC) in the said audit report .

“As a result, according to the media in 2018, from reviewing the domestic crude oil lift sales profile, a total crude oil lift of 8,399,027 barrels with a total sale value of 376,655,589.03 $(N102,659,577,632.16) was reportedly raised jointly by these two companies.

“Therefore, the auditor felt that failing to properly segregate these deliveries and invoice them directly to each company makes it difficult to reconcile and account for each lift.

“Here again, to date, no one has been arrested, and no one has been sacked,” observes the CNPP.

“Additionally, in 2019, the House of Representatives accused federal government ministries, departments, and agencies of not following the Treasury Single Account (CUT) policy, resulting in revenue leakage.

“The Chamber said it found that more than $900 million was still ‘held’ by MDAs outside of the TSA.

“The Chamber charged the Nigerian National Petroleum Corporation, the Nigerian Ports Authority, the Federal Inland Revenue Service, the Nigeria Customs Service, government departments and banks with various offences.

“The Chamber specifically accused NNPC of extra-budgetary expenditures, as the committee said that based on information submitted by NNPC itself, Brass LNG received an appropriation of $511.60 million while the actual release was of $461.54 million in fiscal years 2012-2017.

“The House panel said the ‘2012-2017 Appropriation Acts’ amounted to $550.33 million for the Brass LNG project. But it is very important to note some key observations in the table above: Total credit is $511.60 million, according to NNPC. Actual funding for the Brass LNG project from 2012 to 2017 was $461.54 million. The unused portion is $331.72 million. NNPC reported an unrealized balance, with BMD being $708.29 million.

“The House committee then observed that some MDAS claimed to have obtained presidential exemption to operate certain accounts outside of TSA policy.

“In the case of NNPC, the committee insisted on seeing the alleged exemption letter. However, to the dismay of the committee, the letter merely conveyed the president’s endorsement, signed by an assistant director.

“Lawmakers also accused NNPC of financial dealings outside of the TSA, saying, ‘The balance in this account (CBN Joint Venture) as reported by NNPC, as of October 30, 2017, was $188,900,383.49. These are the various accounts categorized as accounts that are still not transferred to TSA by CBN, DMB account.

“The House Committee had also uncovered three accounts held by NNPC in Aso Savings and Loans PLC and Unity Bank PLC, where the accounts included two investment accounts called NNPC PFL Placement Deposit and the third account called NNPC Pension Fund account. The total balance of these accounts as of August 27, 2017 was N1,079,444,746.49,” CNPP quoted the committee as saying.

“As many as 20 House committee panel recommendations have been unanimously approved by the House and, to date, no NNPC official has been fired, although none have been prosecuted.

“According to a report by the Nigeria Extractive Industries Transparency Initiative (NEITI) in 2021 and widely published in the media, a total of 77 oil companies owed Nigeria N2,659trn in unremitted funds.

“Apart from the constant shortfall in revenue each year, which has led to Nigeria’s borrowing spree to finance its huge budget deficit, with debt servicing gobbling up to 98% of Nigeria’s revenue, the NNPC is said to have made a Huge deduction of N149.2 billion from the Federation Joint Account during the Federation Accounts Allocation Committee (FAAC) meeting in October 2021.

“If NNPC makes huge deductions from the Federation account and often withholds legitimate federal government revenue, how is it possible that the same NNPC is reporting profits for the second year in a row?

“Or does the NNPC convert unremitted federal accounts income and deductions into profits? asked the CNPP.

“The issue of oil theft was also brought up by the boss of NNPC Limited, Mallam Mele Kyari.

“He said the oil spill in the Bodo community of Rivers State led to the Nembe pipeline which is causing the country to lose over 100,000 barrels a day while lamenting the high rate of oil theft in the country.

“For the CNPP, we believe that the NNPC knows who is behind the theft of oil, and that it should prosecute them instead of saying that it has invested heavily in securing its facilities in the rich region. in oil.

“If they don’t know, they should consult human rights lawyer, Femi Falana (SAN), who recently said they have all the information related to the stolen Nigerian crude oil. The attorney recently pledged to make this information available should the federal government need it,” CNPP said.

“With regard to the CNPP, rather than continuing the unsuccessful policy of destroying the hundreds of thousands of illegal refineries operating in the Niger Delta for these years, the NNPC should put in place criteria both for the standardization of operations legal refinery and licensing operators. as operators of modular refineries in the region to save Nigeria billions of dollars wasted on importing refined petroleum products due to inefficient government refining facilities.

“But ideas such as local refining of crude oil can never sit well with NNPC’s management and board, who may be the ultimate beneficiaries of the sustained fuel subsidy scheme that has been individually judged as the most corrupt in the world, even by the All Progressives Congress (APC) before it came to power in 2015.

“NNPC management would rather invest in endless and unnecessary maintenance of Nigeria’s outdated refineries than build modern refineries, at least one refinery in the last seven years of APC’s administration.

“Until NNPC management is brought to answer all questions relating to undisbursed revenue and its corruption-infested grant scheme, CNPP will consider any profit reported by NNPC management as mere paperwork. and, most likely, a manipulation of numbers to confuse unsuspecting Nigerians.

“Therefore, we believe that a profitable NNPC can only be possible when NNPC management is held accountable and Nigeria gets functional refineries that would end the current importation of refined petroleum products into the country.

“We will continue to insist on an independent forensic audit of NNPC’s operations from 1999 to date to enable Nigeria to recover all stolen oil revenues, some of which have been declared unreturned, particularly since 2015,” he said. declared the CNPP.

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