Publish What You Pay-Nigeria’s Concerns Over NNPC  2016 Report And The Management Of Oil And Gas Sector In Nigeria

Press Release

June 23nd, 2017

Publish What You Pay-Nigeria

 The Publish What You Pay-Nigeria (PWYP) having studied the Nigerian National Petroleum Corporation (NNPC) 2016 report found that there are issues of serious concern.

Going by BudgiT analysis, we are worried that the value of crude oil NNPC reported to have been sold does not tally with the amount of crude oil sold, as about 53 million barrels of crude oil was sold in August of the same year, and the value of the crude oil amounted to only $2.51 billion.

The fundamental question becomes, where NNPC got the extra $6 billion.

PWYP is worried that NNPC made its profit in the month of May with N274 million, and in that same month the corporation made an overall loss of N197.49 billion.

This annual financial performance further validates the dominant discourse about the extravagancy expenditure that has characterized NNPC  over the years.

In 2016, Warri, Kaduna and Port Harcourt refineries had very poor performance and made little profit. The poor performance of the refineries calls for a sober reflection on the activities of NNPC.

PWYP believes, there is the urgent need to re-evaluate NNPC operations, and in that evaluation, greater consideration must be placed on workable model that will reposition the refineries and make NNPC compete with its international contemporaries such as Saudi Arabia’s AramCo and Brazilian Petrobras.

The PWYP is mostly worried, in spite the huge amount of monies spent on the refineries turnaround maintenance, the 2016 production capacity stood at about 13.75 percent.

In view of the above, PWYP calls on the NNPC to make public to Nigerians and the world how the huge amount of monies spent in the refineries turnaround maintenance were utilized.

In 2016, NNPC paid $72.87 million into Federation Account Allocation Committee (FAAC) account, making a different from 2015 which stood at $607.82 million. Of a great concern is that remittances were made six times in 2016 and 2015 respectively. This is even as statutory requirement demands that remittance be made every month.

Axiomatically, the $534.95 million differentiation found in the 2015 and 2016 payments is enough to address Nigeria’s 2016 budget deficit, and save the country from the $500 million Euro bond debt.

Publish What You Pay  acknowledges and appreciates government efforts targeted toward addressing the challenges in the oil, gas and solid minerals, particularly in the areas of transparency and accountability.

However, we call on the NNPC to improve beyond transparency mechanisms and also ensure that its operations are sophisticated and in compliance to international standard as Nigeria is  Extractive Industries Transparency Initiative (EITI) operating country.

PWYP equally joins our partner, BudgIT and other CSOs to ask below questions that bug the mind

1 Why are the NNPC corporate headquarters and the refineries performance very poor in terms of financial probity and accountability

2 Why was the crude sales remittance not matching the crude payment receipts?

3 95 million barrels of crude oil is still being processed under swap products arrangements when it is believed swap arraignment has been discontinued.

4 Why was NNPC not making remittance of dollar payment to FAAC every month

Publish What You Pay Nigerian, therefore calls on the National Assembly to hasten the passage of the Petroleum Industry Governance Bill (PIGB), the law PWYP believes will go a long way to bringing a major reform to the oil and gas sector.

National Coordinator,

For

PWYP-Nigeria