Lagos, Nigeria (Platts) – Nigerian state oil firm Nigerian National Petroleum Corporation (NNPC) needs to account for $10.8 billion oil revenue earned between January 2012 and July 2013, the finance minister Ngozi Okonjo-Iweala said Monday.
The money has not been remitted into the necessary account, she said while presenting Nigeria’s 2014 budget.
NNPC, which exports crude on behalf of the government, said recently the theft of crude meant revenue was lower than it might have been, and that some of what had been collected was used to repair damaged oil pipelines and pay the cost of subsidising gasoline imported during the period.
Okonjo-Iweala said NNPC had been summoned to justify the expenditure.
“We need to see the justification, with receipts, where the money has been spent. Where this is not so, NNPC will need to account for the money. We need all the money due to the Federation Account and reconciliation with NNPC on the money is under way.”
Oil accounts for more than 80% of government revenue.
NNPC, which has been criticized for lacking transparency in recent years, said January 10 it lost $720 million in potential revenue to crude oil theft and production disruption during the period, while another $1.22 billion was incurred in the repair and maintenance of its 5,000 kilometres of pipelines.
Okonjo-Iweala said Nigeria faced tough challenges this year, amid slow growth in the global economy and with an expected drop in demand for the country’s crude from the US because of shale gas development.
Nigeria has proposed a Naira 4.64 trillion ($29 billion) budget to parliament for 2014, based on a benchmark oil price assumption of $77.5/barrel and production of 2.38 million b/d.
Local analysts have said the oil output target might not be met on account of disruption to production and the lack of new investment.
“It means a wake-up call for us to really work at diversification of our economy away from oil,” Okonjo-Iweala said.