NNPC faults AGF’s report, admits owing N326.14bn

In a sharp reaction, the Nigerian National Petroleum Corporation, NNPC, Wednesday said it did not fail to remit N3.325tn to the Federation Account. It however admitted owing The Federation Account N326.14bn.

The corporation was reacting to revelations in the report of the Auditor-General of the Federation to the National Assembly on Monday, alleging that the NNPC failed to remit the sum of N3.235tn to the Federation Account for the period.

In a document signed by the corporation’s Group Executive Director/Chief Financial Officer, Finance and Accounts, Mr. Isiaka Abdulrazaq, the NNPC said: “The NNPC wishes to state in strong terms that the AGF’s declaration is inaccurate.

“The Auditor-General of the Federation’s declaration is erroneous. It should also be noted that although this period is before the new NNPC management was appointed in August 2015, the management still deems it fit and important to correct any misinformation about the activities of the corporation as this will adversely affect its current and future financial and operational plans if not corrected.

“The declaration by the AGF may have been born out of misunderstanding of how revenues from crude oil and gas sales are remitted into the Federation Account.”

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On how the funds in question were utilised, the NNPC explained that as part of its responsibilities, the NNPC got an allocation of 445,000 barrels of crude oil per day for processing into petroleum products for distribution across the country, adding that any unprocessed crude was sold and the proceeds used to pay for the importation of petroleum products.

It futher added that the proceeds from the sale of the products are remitted to the Federation Account after deducting the cost associated with the supply and distribution.

This cost included subsidy on petroleum products, the NNPC said, adding that the corporation in entitled to subsidy claims on petroleum products sold at government-regulated prices, whether imported or locally refined.

According to it, N2.34tn had been approved and certified for it by the Petroleum Products Pricing Regulatory Agency, PPPRA for the period of January 2012 to December 2014 while additional N7.96bn subsidy claim was still under reconciliation.

Continuing, the NNPC said other costs included oil and petroleum product losses as a result of vandalism on its network of pipelines and petroleum holding cost and pipelines maintainance amounting to N202.68bn and N358.88bn respectively for the
period of January 2012 to December 2014

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