The Nigerian National Petroleum Company Limited (NNPCL) has been accused of financial misconduct by the Auditor- General of the Federation, who alleges that the company diverted ₦2. 68 trillion and $9. 77 million over the past four years....Read Full Article >>➤
These claims, based on the Auditor- General’ s annual reports from 2017 to 2021, have drawn criticism for undermining Nigeria’ s financial stability. The reports, analyzed by Sunday PUNCH, detail substantial financial violations, including the diversion of ₦1. 33 trillion in 2017, ₦681. 02 billion in 2019, ₦151. 12 billion (alongside $19. 77 million) in 2020, and ₦514 billion in 2021.
These infractions reportedly breached the Nigerian Constitution and the 2009 Financial Regulations Act. Additionally, the NNPCL has been accused of ignoring corporate governance standards by failing to respond to or justify the Auditor- General’ s findings during the review period.
Key Findings on Financial Irregularities
The NNPCL’ s financial practices have been criticized for a lack of transparency. The World Bank’ s December 2023 Nigeria Development Update flagged the company’ s opaque handling of subsidy arrears and revenue impacts from subsidy removal. Former Central Bank Governor Sanusi Lamido also described the NNPCL as ” the most opaque oil company in the world. ”
The audit revealed 14 key infractions, including unauthorized revenue deductions, discrepancies in crude oil allocations, and unreported crude oil losses. Specific examples include:
2017: ₦1. 33 trillion was deducted without authorization from ₦2. 41 trillion in revenue, leaving only ₦1. 07 trillion in the federation account, in violation of Section 162(1) of the 1999 Constitution.
2019: Seven irregularities totaling ₦681. 02 billion were reported, including ₦519. 92 billion remitted from ₦1. 27 trillion generated by the National Petroleum Investment Management Services and discrepancies in crude oil data.
2020: Unauthorized deductions of ₦151. 12 billion for projects and handling costs lacked necessary approvals or documentation.
2021: ₦343. 64 billion in operational costs from crude oil sales was deducted without explanation, ₦50 billion meant for the federation account was unremitted, and ₦82. 95 billion was allocated to refinery rehabilitation without approval.
Additional issues included misreporting ₦3. 75 billion from petrol sales and diverting ₦83. 66 billion in miscellaneous income into a sinking fund rather than the federation account.
These findings highlight significant lapses in financial management and internal controls at the NNPCL, raising serious concerns about its impact on the Nigerian economy. The government has reportedly relied on borrowing to mitigate the financial gaps caused by these irregularities. ...Read Full Article >>➤
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