NNPC Is Operating At a Loss – GMD

The management of the Nigerian National Petroleum Corporation (NNPC) last week blamed huge operational losses in its business for its inability to pay about N142.7 billion, money that the House of Representatives Committee on Finance claimed the corporation and its subsidiaries owe the Federal Government.

The management of the Nigerian National Petroleum Corporation (NNPC) last week blamed huge operational losses in its business for its inability to pay about N142.7 billion, money that the House of Representatives Committee on Finance claimed the corporation and its subsidiaries owe the Federal Government.
Though the corporation refused to provide details on the quantum of the losses, it described the claim by the lawmakers as embarrassing and regrettable as the committee had not completed its assignment on the review and reconciliation of its account books before going public with its claim.
Chairman of the House of Representatives Committee on Finance, Abdulmumin Jibrin, had said last week Monday that the Corporation's conduct violated the provisions of the Fiscal Responsibility Act, FRA, 2007.
Consequently, the Committee asked the Inspector General of Police, IGP, to arrest the Corporation's Group Managing Director, Andrew Yakubu; the Executive secretary, Petroleum Products Pricing Regulatory Agency, PPPRA, Reginald Stanley; and director, Department of Petroleum Resources, DPR and bring them before the House on Tuesday.
The three men were accused of refusing to honor repeated invitations to explain why the NNPC failed to remit the said amount from the N6trillion Internally Generated Revenue, IGR, realized between 2009 and July last year to the Consolidated Revenue Fund, CRF, as demanded by law.
Also summoned were the chief executives officers of all the 16 subsidiaries of the oil corporation, including the Nigerian Liquefied Natural Gas Company, NLNG and the refineries.
According to Committee Chairman, in 2009, the Corporation generated N2.048 trillion and realized N2.155 trillion in 2010 while N1.9trillion was realized in 2011 and N259billion in 2012 as its IGR.
He said however that between 2009 and 2012, the NNPC failed to remit anything from the N6 trillion it generated to the CRF as demanded by law.
Consequently, a technical committee was constituted to examine the books of the corporation and its 16 subsidiaries to ascertain what was due to the Federal Government.
According to the lawmakers, findings at the Office of the Accountant-General of the Federation, revealed that N549.9 billion was deducted from the proceeds of crude oil sales for the 2007 Joint Venture Cash Calls (JVC); N1.168 trillion for Excess Crude, and N236.6 billion for Petroleum Product Subsidy, while N25.951 billion and N62.542 billion were excess proceeds deducted in respect of Petroleum Profit Tax (PPT) and Royalties respectively.