NNPC (1)Disturbed that a shortfall of $13 billion, between January and August this year, is yet to be accounted for by the Nigerian National Petroleum Corporation (NNPC), the House of Representatives yesterday raised an ad hoc committee to find out the volume and value of crude oil sales by the corporation for the whole year.
The committee was also mandated to probe remittances into the federation account by the NNPC within the same period.

This is as the House directed the committees on petroleum resources (upstream and downstream), national planning and finance to widen its dragnet by investigating the effect of dwindling oil revenues as a result of the development of the technology of fracking in the hydrocarbon industry globally.

Moving the motion to probe the NNPC, Hon. Haruna Manu, who also noted that the revenue that accrues to the corporation from the sale of oil is the collective patrimony of the federal government that must be remitted in accordance with section 162 (1) of the constitution, expressed worry that there was a lacuna in the declaration of the corporation in this regard.

“The information credited to the NNPC on the status and remittances to the federation account and the claim that the total crude oil sales from January to August 2013 was $20 billion whereas the NNPC remitted only $7 billion to the federation account,” Manu submitted.

Also perturbed that “there have been lingering issues of accountability and arbitrary management of oil revenue by the NNPC,” Manu stated that it has become necessary to compel the corporation to “render accounts of how much revenue it derived from the sales of crude oil from January 2013 to date, and how much has actually been paid into the federation account.”

Supporting the motion, Hon. Adeola Solomon Olamilekan, who emphasised that the shortfall in revenue accruing to the federal government had been an annual occurrence in the past seven years, advised the ad-hoc committee to scrutinise the joint venture agreement between the NNPC and some oil companies.

Olamilekan, while informing the House that not too long ago the Auditor-General of the federation reported that several billions were fretted away, urged the ad-hoc committee to liaise with the House committee on public accounts which had done similar investigation in the past.

Meanwhile, convinced that Nigeria was losing its ‘traditional customers’ as a result of the development and use of fracking technology to source for oil, the House stressed “the need to urgently diversify the nation’s sources of income in order to avoid the looming disaster” of a monumental revenue decline.

It, therefore, mandated four committees “to summon the relevant government ministries and agencies with a view to investigating the impact of dwindling oil revenues as a result of the surge in shale gas production through fracking and make appropriate recommendations to the House within four weeks.”

Meanwhile, some disquiet is already brewing within the marketing arm of the corporation as eyebrows have been raised over the decision of the Petroleum Products Pricing Regulatory Agency (PPPRA) to issue licences to 50 petroleum products marketing companies to import about 3.5 million tonnes or around 30 million litres for the fourth quarter of 2013, up from 32 companies granted permit in the first quarter of this year.

The number of participating companies was reduced from 128 in 2011 to about 38 in the fourth quarter of 2012 to check shady deals in the nation’s fuel import scheme.

Following the outcry over the N2 trillion subsidy bill in between 2010 and 2011 and subsequent probes into the Petroleum Support Fund (PSF), PPPRA, had declared that it would further trim the import list to around 20, to stem corruption in the system.

But in a twist of policy, the agency increased the list for the third quarter, which ended on September 30 to 41 oil marketing companies, on the grounds that it was aimed at ensuring the availability of adequate petrol for consumers.

The sudden increase in the list of participating firms to 50 for the fourth quarter has triggered fears among stakeholders that Nigeria might be heading towards another crisis in the fuel subsidy scheme, when licences issued to importers were grossly abused.


[This Day]