NNPC failed to remit $11.6billion in LNG export revenue

June 10, 2015 | Management, Nigeria

Lagos, Nigeria | State-owned Nigerian National Petroleum Corporation, NNPC has not remitted $11.6 billion in dividends and loan and interest repayments earned from exports from the Bonny LNG plant from 1999-2012, Nigeria’s oil industry auditors said Tuesday.

NNPC could not immediately be reached for comment Wednesday.

The Nigerian Extractive Industry Transparency Initiative, or NEITI, said in a statement that the earnings represent NNPC’s share of 49% equity ownership in Nigeria LNG Ltd., owner of the six-train, 22 million mt/year Bonny LNG plant.

“In the course of NEITI’s audit, the NNPC was unable to provide any evidence that the funds were remitted to the Federation Account as required by law,” said Zainab Ahmed, NEITI’s executive secretary.

The agency urged the new administration that took office May 29 to ensure the recovery of the revenue, especially given the “the new administration is in dire need of funds to tackle the complex problems facing the nation.”

NNPC said in an explanatory note to NEITI that it has “presidential approval to sequester the NLNG dividend to fund all gas-related projects.” It said an inter-ministerial committee was working on reconciling the revenues.

NNPC holds 49% equity in NLNG on behalf of the Nigerian government, with partners Shell (25.6%), Total (15%) and ENI (10.4%.)

NLNG exports average of 300 cargoes/year of LNG to buyers in Europe, America and Asia. It said in May it earned about $30 billion in dividends from gas exports over the past 15 years and paid about Naira 220 billion ($1.1 billion) in taxes alone to the Nigerian government in 2014.

Nigerian security agencies are currently probing NNPC’s crude swaps for oil products and offshore crude processing agreements with international oil trading groups, for which various sources said the government lost several billions of dollars in potential revenue.

Nigeria’s new President Muhammadu Buhari made rooting out corruption in NNPC a major part of his election campaign.