The Nigerian National Petroleum Company Limited (NNPCL) has stated that it would continue to work and investigate with the Nigeria Extractive Industries Transparency Initiative (NEITI) to assess its purported debt to the federation.
The oil company will also collaborate with pertinent parties in the reconciliation committee that President Bola Tinubu established to look into, review, and reconcile the financial records on the Federation Accounts Allocation Committee’s (FAAC) claimed indebtedness, according to a statement released by NNPCL Chief Corporate Communications Officer Olufemi Soneye on Monday.
He added that the decision was made in response to a request for an investigation into several amounts of money that NNPC was purportedly owing the federation by an unidentified non-governmental organisation (NGO).
According to the statement, “the NGO’s [call] was baseless, considering that after a series of engagements with NNPC Ltd., NEITI itself had dismissed many of the allegations in the said 2021 report.”
News About Nigeria reports that Soneye stated that during the beginning of Tinubu’s administration, the company was forced to sell premium motor spirit (PMS), which was imported into the nation “at one-third of its value.” As a result, the company said, it was forced to incur an average monthly subsidy bill of N400 billion, which put a strain on its finances and revenues.
As of May 31, 2023, the NNPCL reports that the subsidy bill has accrued to a sum exceeding N3.736 trillion. According to the firm, the federation’s failure to pay its portion of upstream joint venture gas delivered to government-owned facilities resulted in a buildup of N174.07 billion in debt.
“Similarly, as of May 31, 2023, the federation’s receivables to NNPC Exploration & Production Limited (NEPL) amount to $712 million (equivalent to N309.07 billion at N434.08/US$1) for revenues not remitted to NEPL but paid into the Federation account.”
“While the Federation owed NNPCL N4.207 trillion in net indebtedness, the Company owed the Federation only N2.852 trillion, which was primarily made up of outstanding Good and Valuable Consideration (GVC) in respect of government upstream divestments, royalties, and Petroleum Profit Taxes (PPT)”, Soneye affirmed.
He also noted that over the years, NNPC’s relationship with NEITI has been very cordial, as seen in August 2020 when they became an EITI-supporting company.
