NNPC Denies $8.3b Debt to Federal Government
The Nigerian National Petroleum Corporation (NNPC) has described the report of the Nigerian Extractive Industries Transparency Initiative (NEITI), which accused it of owing the federation N1.3 trillion as misleading.
In a statement, it explained that the N928billion ‘debt’, has been paid since the first quarter of last year. This can be verified with the relevant authorities, the corporation said.
The Manager, Group Public Affairs, Umar Mohammed, said: “The report contains fundamental inaccuracies, which are misleading and constitutes misinformation to the public.
“One would have expected NEITI to take cognisance of this process in the report to avoidmisrepresenting NNPC’s debt profile.
“The N377 billion purported debt was a carry-over of 2004-2005 when NNPC was directed to buy crude oil for domestic consumption at the international market price, while the sale of petroleum products was at subsidised prices without appropriate instrument to recover the shortfall.”
On subsidy, Mohammed explained that NNPC’s subsidy claims were verified and approved for payment by the relevant agencies, adding that the claims due to NNPC were not “cash payments as amounts duly approved are backed out from the Gross Domestic Oil revenue due to the Federation Account in any given month”. This is the extant process for this transaction, he added.
On the N1.4 trillion, he said: “The report deliberately ignored, and or omitted the factors responsible for the increasing amounts paid, especially the price of crude oil which accounts for 82 per cent of the price build-up for petroleum products.
“It should be noted that as a fall out of the subsidy crisis of 2012, other players that constitute over 50 per cent of the market share in the downstream, refused to import petroleum products from their supply obligation. NNPC being the supplier of last resort under the NNPC Act, continued to supply the nation at huge cost while still maintaining the strategic reserve obligation”. He added that NNPC should be commended on the matter.
The corporation said its response to the NEITI 2009-2011 became imperative to clear its name.
“From the foregoing, NEITI without taking cognizance of the extant laws and regulations, guidelines and terms of relevant contracts in NNPC’s operations, has continued to portray the corporation to the public in bad light. The report contains fundamental inaccuracies, which are misleading and constitutes misinformation to the generality of the public, the statement, he said.
The corporation said it is awaiting a formal engagement with NEITI to close the report.