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NEITI audit queries pit Finance Ministry against NNPCL
🇳🇬 Nigeria /Economy & Trade

NEITI audit queries pit Finance Ministry against NNPCL

From Vanguard · () English

Summarized and contextualized by DistantNews.

At a glance

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  • Nigeria's Finance Ministry and the national petroleum company (NNPCL) are blaming each other for unresolved audit queries from 2021-2023.
  • Key issues include a $3 billion pre-export loan from 2012 and $722.6 million in LNG dividends that were not remitted or accounted for.
  • The Senate Committee on Public Accounts is demanding explanations and has called for the NNPCL and another regulator to appear alongside the Finance Ministry.

Nigeria's Federal Ministry of Finance and the Nigerian National Petroleum Company Limited (NNPCL) are locked in a dispute over unresolved financial queries highlighted in the 2021-2023 Oil and Gas Sector Audit Report by the Nigeria Extractive Industries Transparency Initiative (NEITI). The conflict surfaced as the Permanent Secretary of the Finance Ministry, Raymond Omachi, appeared before the Senate Committee on Public Accounts.

Omachi informed the committee that his ministry could not provide all the necessary documentation to address NEITI's queries. He stated that agencies involved in the transactions, particularly the NNPCL, had failed to submit the required financial records. This lack of transparency affects several critical issues, including the unclear recovery of a $3 billion pre-export financing loan obtained in 2012 for subsidy payments. Another major concern is the $722.6 million in dividends and interest paid by Nigeria LNG Limited to the NNPC in 2021, which NEITI reported as neither remitted to the Federation nor properly accounted for.

We don’t have direct involvement in all the issues raised and required provision of financial records from the affected agencies, particularly NNPCL, NUPRC, etc., is not there.

— Raymond OmachiThe Permanent Secretary of the Ministry of Finance explained why his ministry could not provide all requested documents to the Senate Committee.

The audit also found that none of Nigeria's refineries were operational in 2021, despite significant reported spending. Additionally, overhead costs of $221.283 million incurred by the National Petroleum Investment Management Services (NAPIMS) in 2021 remain unresolved. The Finance Ministry has engaged external auditors for a forensic audit, but the committee expressed concern over repeated extensions for this process.

Senator Ibrahim Dankwambo, chair of the committee, insisted that both the NNPCL and the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) must appear at the next sitting to provide direct explanations. He asserted that the Finance Ministry possesses the authority to compel these agencies to attend, underscoring the urgency of resolving these long-standing financial discrepancies.

I know you have enormous powers that you can use to compel these agencies to appear before us.

— Senator Ibrahim DankwamboThe Senate Committee Chairman urged the Finance Ministry to ensure the NNPCL and NUPRC attend the next hearing.
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Originally published by Vanguard. Summarized and contextualized by our editorial team with added local perspective. Read our editorial standards.

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