By Adeola Yusuf –
President Goodluck Jonathan last Wednesday waded into the bickering between the Nigerian National Petroleum Corporation (NNPC) and the Central Bank of Nigeria over the missing $49.8 billion oil revenue.
The two agency of government have been accusing each other of complexity in the missing oil revenue, representing 76 per cent of the total crude oil revenues from January 2012 to July 2013.
Before this revelation, the African Development Bank (AfDB) had disclosed that an estimated N390 trillion ($2.6 trillion) is stolen annually through high level corrupt practises in Nigeria and other African countries.
President of AfDB, Dr Donald Kaberuka who stated this in a statement to mark the International Anti-Corruption Day maintained that another one trillion dollars were being paid in bribes across the world every year.
The N390 trillion stolen in Africa annually, according Kaberuka, amounted to more than five per cent equivalence of the global GDP.
The feud
In a statement on Thursday, the CBN warned Nigerian politicians not to politicise the issue it raised accusing the Nigeria National Petroleum Corporation, NNPC, of not remitting the sum of $49.8billion, representing 76 per cent of the total crude oil revenues from January 2012 to July 2013.
The NNPC had, however, refuted the claim made by the CBN Governor, Mallam Sanusi Lamido Sanusi.
In the statement, the CBN’s Director, Corporate Communications, Ugochukwu Okoroafor, said the “CBN will neither confirm nor deny the existence of such a letter and considers any discussion by it on the alleged letter to be inappropriate.”
But General Manager, Media Relations Department of the NNPC, Dr. Omar Farouk Ibrahim who refuted the claims however maintained that the figure given by the CBN governor “does not represent the correct picture of crude oil lifting for the period.”
Ibrahim said the corporation found it necessary to clarified based on the CBN’s misunderstanding of the workings of the oil and gas industry and the modality for remitting crude oil sales revenue into the Federation Account.
“For the avoidance of doubt, it needs to be stated that the figure of 594.024 million barrels of crude oil given by the CBN as the total crude oil lifting for the period of January 2012 to July 2013 does not represent the correct picture of crude oil lifting for the period.
“From our records, the correct figure is 618.55m barrels. This shows that the CBN understated the actual crude lifting by 4.13 per cent,” Dr. Ibrahim stated.
He explained that revenues from crude oil lifting are in various categories, namely: Equity Crude; Petroleum Profit Tax, Royalty, Third Party Financing and the Nigerian Petroleum Development Company, NPDC. Revenues from each of these categories are statutorily collected by different agencies of the government.
The NNPC collects only one of the aforementioned categories, namely Equity Crude. Petroleum Profit Tax is collected by the Federal Inland Revenue Service, FIRS, Royalty goes to the Department of Petroleum Resources, DPR, Third Party financing goes for Research, Development, Program and Satellite fields Development, while NPDC goes to NPDC for upstream development.
While the NNPC pays proceeds from Equity crude directly to the Federation Account with the CBN, the FIRS and DPR pay PPT and Royalty respectively into the Federation Account with the CBN.
The sum total of these proceeds make up the alleged unremitted revenues, Dr. Ibrahim stated.
“The 24 per cent of total crude oil revenue receipts which the CBN governor is reported to have acknowledged that NNPC remitted represents the proceeds from the equity lifting which NNPC is directly responsible for.
“The alleged unremitted 76 per cent was paid to the agencies that are statutorily empowered to receive them for onward remittance into the Federation Account”, Dr. Ibrahim explained.
He stressed the need for institutions of the Federal Government and top government functionaries to seek understanding of issues that are not clear to them from relevant agencies rather than go public with misleading information that is capable of creating public disaffection.
He expressed NNPC’s availability at all times to meet with all relevant stakeholders to clarify issues.
Sanusi’s letter however says the missing $49.8 billion is from the value of oil NNPC sold, and makes a distinction with taxes. It says under law, the NNPC must submit all oil export proceeds.
“As an indicator of how bad this situation has become, please note that in 2012 alone, the Federation Account received $28.51 billion in Petroleum Profits and related taxes but only $10.31 billion from crude oil proceeds,” the letter said.
NNPC sold 46 percent of Nigeria’s oil between January 2012 and July 2013, but its remittance amounted to only one-third of the taxes paid by oil companies that exported the other 54 percent, the letter claimed.
NNPC exports Nigeria’s share of around two, to 2.5 million barrels per day of oil the country produces, mostly in joint ventures with oil majors like Royal Dutch Shell, Exxon Mobil, Italy’s Eni and Chevron.
Crude exports and taxes earned from these oil majors account for around 80 percent of government revenues in Africa’s second largest economy and top oil producer.
Presidency’s intervention
While the CBN, through its Governor, Sanusi Lamido Sanusi insisted in a letter to President Jonathan that the NNPC withheld the money, the NNPC on the other hand refuted the allegation.
A source at the Presidency told Daily Independent that heads of the two agencies have been warned to henceforth compare notes before going public over issues.
“The Group Managing Director of the NNPC has been queried by the Presidency, through the minister of Petroleum resources, to explain how the alleged money got missing while the CBN governor was also cautioned to first compare notes with the NNPC before coming up with such a letter.
“Both the CBN and NNPC are agencies of the government and you continue to wonder if this bickering, which is unnecessary in the first place, is not intended to discredit this administration,” the source said.
“Owing to what this issue has created, they have been ordered to henceforth compare notes before going into the public with such information,” he added.
The CBN had it would be recalled said that the NNPC hasn’t accounted for nearly $50 billion in revenue from the sale of crude oil which should have been paid into government accounts under law.
CBN Governor Sanusi said in his letter dated September 25 and addressed to President Goodluck Jonathan, that NNPC earned $65.3 billion from crude oil sales between January 2012 and July 2013 but only remitted 24 percent of this to the federation account and $49.8 billion was still outstanding.
“I am constrained to formally write your Excellency, documenting serious concerns of the CBN on the continued failure of the NNPC to repatriate significant proportions of the proceeds of crude oil shipments it made in gross violation of the law,” the letter read.
Last line
To get to the root of the matter and in view of the weight of the allegations and indeed the amount involved, vis-à-vis what it means to the federation’s account, there is need for the Federal Government to set up a committee to look into them. It will therefore enable government mete appropriate punishment to whosoever is found wanting. Only this will restore the waning trust, many Nigerians have in the present administration.
Adeola Yusuf is a Senior Correspondent with Daily Independent Newspaper.
