NNPC Missing $20bn Audit report exposes subsidy payment scam, unauthorized spending

The report also stated that the NNPC had capitalized on lapses in the current law to spend part of the crude oil sales proceeds without limit or control.

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NNPC Group General Manager, Public Affairs Division, Ohi Alegbe play

NNPC Group General Manager, Public Affairs Division, Ohi Alegbe

(Eagle Online)
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The audit report conducted into the accounts of the Nigerian National Petroleum Corporation (NNPC) by PricewaterhouseCooper(PwC) has indicted the oil company of making double subsidy claims on petrol and kerosene.

The report also stated that the NNPC had capitalized on lapses in the current law to spend part of the crude oil sales proceeds without limit or control.

The audit report reads:

“Our examination of the PMS and DPK import verified by PPPRA revealed that some discharges were apparently verified and subsidy advised to NNPC more than once.”

PwC alleged “repeated subsidy” for PMS amounting to N3,709,879,190 ($23,954,796) and another “repeated subsidy” for DPK amounting to N6,169,502,266 ($39,836,652). It added that the there was another $36.05m “over-statement” in PPPRA’s PMS subsidy payment advice to the NNPC.

“We recommend that the NNPC Act be reviewed as the content contradicts the requirement for the NNPC to be run as a commercially viable entity. It appears the Act has given the corporation a blank cheque to spend money without limit or control,” the report reads.

“This is untenable and unsustainable, and must be addressed immediately. The corporation should be required to create value and meet its expenses entirely from the value created. Proceeds from the FGN’s crude oil sales should be remitted entirely to the Federation Account. Commissions for the corporation’s services can then be paid based on agreed terms,” it adds.

President Goodluck Jonathan ordered the audit into NNPC’s accounts after former Central Bank Governor, Sanusi Lamido Sanusi alleged that the corporation had failed to remit $20 billion into the Federation Account.

Jonathan ordered the release of the audit report on Monday, April 27, 2015, after President-elect, Muhammadu Buhari stated that he would conduct a fresh probe into the allegations of missing money.

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