The Nigerian National Petroleum Corporation, NNPC, on Thursday said that it had been remitting all revenues accruing to it to the Federation Account.
The corporation’s Group Managing Director (GMD), Maikanti Baru, gave the clarification when he hosted members of the Senate Committee on Petroleum (Upstream) who were at his office in Abuja on an oversight visit.
A statement issued by the Group General Manager, Group Public Affairs Division of NNPC, Ndu Ughamadu, quoted the GMD as saying that the allegations of non-remittance of funds had become a recurrent decimal over the years, attributing it to the nature of the corporation’s operations which involved credit lines requiring constant audit and reconciliation.
Baru clarified: “While the process of audit and reconciliation of accounts is on, a lot of accusations of short payments and non-remittances are usually traded, we endeavour to keep our cool on these allegations because we know that we remit whatever is due to the Federation Account.”
Expatiating further he pointed out that such allegations usually arose from disagreements over expenses borne by the corporation on behalf of the Federal Government.
On efforts by the NNPC to ensure that Joint Venture (JV) and Production Sharing Contract (PSC) partners do not make excessive claims at the expense of the country, the GMD explained that the establishment of an Efficiency Unit in the corporation to ensure value for money across all operational units was designed for the purpose.
This is even as he said that the NNPC had also done a lot in renegotiating contracts as well as benchmarking costs in keeping with international best practices, saying that the effort had yielded positive results, including reduction in the cost of crude oil production per barrel.
On why the PSC agreements had not been reviewed for a long time despite clauses in the agreements that stipulate periodic review, Baru disclosed that a presidential approval had been secured and that a committee would be set up soon to carry out the review.
The industry expert pointed out that in the absence of a comprehensive review, NNPC had considered at projects on a project-by-project basis and raised observations which some of the partners had taken permission to present before their managements.
Earlier in his comments, the Chairman of the Senate Committee on Petroleum (Upstream), Senator Omotayo Alasoadura, said that the committee desired to be having month-by-month crude oil production figures for the past two years and crude prices for the period.
The lawmaker also charged the corporation to cooperate with the Senate in providing input on the fiscal component of the Petroleum Industry Reform Bill and the other segments of the bill slated for public hearing next week at the National Assembly.
He said: “We have just come to fulfill another part of our mandate, which is to oversee what NNPC is doing. It’s not a mission to harass anybody, it’s for us to understand each other, give advice, as nobody is a sole repository of knowledge.
“Everybody knows that Baru is very knowledgeable in the industry, but he can’t know everything, even people who don’t know anything about the Industry may have useful ideas that can be of help”, the Senator added.
Other members of the committee on the oversight function parley include, Senators Gershom Bassey (Vice Chairman), Biodun Olujinmi, Fatimat Raji Rasaki, Clifford Ordia, Victor Umeh, Osinakachukwu Ideozu, Stella Oduah and Sam Egwu.
