The Nigerian National Petroleum Corporation, (NNPC), has said that contrary to reports that it is owing the Federation Account the sum of N3.8 trillion, it is the Federation Account and Allocation Committee (FAAC) that’s owing it the sum of N787 billion from over draft.
This was made known by the Corporation on Tuesday when it appeared before the House of Representatives Public Accounts Committee to respond to audit queries issued against it by the office of the Auditor General of the Federation.
The Chief Financial officer of the group, Umar Ajiya told the panel that the said account was audited by KPMG at the instance of the governors forum and FAAC to find out the whereabout of the money.
“Summary of the report indicates that NNPC was owing N557 billion and not N3.8 trillion. The same report established that NNPC was also owed N787 billion. In effect, the federation was owing NNPC N237 billion NGF funding account
“From the Nigeria Gas company, the sum of $30.9 million dollars was expended by the NNPC through Nigeria Gas Company funding account. The AuGF has queried the benefit of that account to the federation.
“Similarly, the sum of $198 million dollars unpaid cash revenue and the AuGF has listed the companies that are supposed to pay these monies, $30.9million not remitted to Federation Account but stated to have been paid through the NGF funding account”, he said
Asked to recap the basis for the audit queries, the AuGF representatives on the panel said records from the FAAC secretariat examined revealed that total revenue from collecting agencies amounted to N6.01 trillion.
“From the total revenue of N2.4 trillion payable to the Federations Account by NNPC, the corporation deducted N865.4 billion which represented the Joint Venture Cash call before paying the net figure of N1.577 trillion to the Federation Account. The net figure of N582.9 billion was paid into the Federation Account from the total of N608.0 billion collected by the Department of Petroleum Resources after deducting N25 billion as excess proceed from royalty.
“NNPC made a deduction of N865.4 billion from the revenue collected contrary to the provisions of section 162 of the constitution which stipulate that all revenue collected should be paid into the revenue account. This has been a regular occurrence in previous Auditor General’s reports without positive response from NNPC management.
“The management of NNPC should desist from further violation of the constitution and ensure that all monies accruing to the federations account are promptly paid without any deduction. The federal government should agree on a percent to be paid to the NNPC as cost of collection and any monthly payment to NNPC should be done by FAAC as is being done to other revenue agencies”, the queries noted.
Recall that controversy had dogged the failure of the corporation to appear before the panel, despite many invitations to that effect.
While the letters specifically demanded the presence of the Group Managing Director, Mele Kyari alongside heads of all subsidiaries of NNPC, it was the Chief Financial Officer of the Corporation who showed up, saying that he is responsible for all financial matters of the Group including subsidiaries.
“It is believed that whatever the subsidiaries have reported, I am responsible for the entire financial reporting of the group and so also, the Group Managing Director and so, I can answer any query relating to them”, Ajiya said.
But the Committee chairman, Hon. Oluwole Oke (PDP, Osun), reminded the NNPC official that “this parliament is a parliament of rules and the constitution of the federal republic of Nigeria has given us the window to conduct our activities in a manner that is suitable for us. When we ask your subsidiaries to cause appearance, it is pursuant to section 88 and 89 of the constitution.
“We want to hear from them and obtain evidences from them because they are subsidiaries and there are chief executive officers. We have queries against NAPIMS. Yes, NAPIMS reports to you, but it is our own right in this parliament to determine how we conduct our own business. We have a mystery to cure. We want to be able to ask the DD of Warri Refinery or the MD of Kaduna Refinery questions because there is queries from the Auditor General against them. I am from the corporate world and would have agreed with you. But when the Auditor General of the Federation specifically listed agencies, they must cause appearance before this committee.
“DPR has been here and has answered all their queries. Our ruling is that all subsidiaries under NNPC should cause appearance within two weeks. We don’t want to engage any agency of government in mudslinging.
“Members of the public are asking us why we have not laid our report. The truth is that as agencies of government, they are entitled to fair hearing. So, they need to appear here and defend all the queries against them so that we can lay our report”, Chairman Oke ruled.