All hell was let loose when then Central Bank of Nigeria (CBN) Governor, Sanusi Lamido Sanusi, first alleged towards the ending of 2013 that the Nigerian National Petroleum Corporation (NNPC) was withholding over $40 billion from the Federation Account. Although the Presidency pooh-poohed the allegation, especially after the apex bank governor kept changing the figures before finally settling for $20 billion, a huge public outcry provided the impetus for the setting up of a panel by the Finance Minister and Coordinating Minister of the Economy, Ngozi Okonjo-Iweala, to investigate the allegation.
The panel concluded that only $10 billion was unaccounted for. But many Nigerians were still not satisfied, causing the minister to promise to invite a reputable international audit firm to conduct a forensic audit of the NNPC accounts. PriceWaterhouseCoopers (PWC), the accounting and auditing global giant, ultimately elected for the task, released its findings not too long ago. The only thing that Nigerians were told by the Presidency at the time was that $1.48 billion, not $20 billion as alleged by Sanusi, was unaccounted for.
But it was easier for a camel to pass through the eye of a needle than for others outside a closely-knit cabal in the Presidency to set eyes on the report. Written requests by the appropriate committees of the Senate and the House of Representatives to the Auditor-General of the Federation, the Ministry of Finance and the Ministry of Petroleum Resources to be provided copies of the forensic report were completely ignored.
Whatever may constitute the president’s reason(s) for suddenly ordering the release of the report to the public, the naked truth is that the forensic report has opened a much bigger can of worms! Yes, it stated that both the NNPC and its subsidiary company, the Nigerian Petroleum Development Corporation (NPDC), should refund $1.48 billion to the Federation Account, but it could equally have been $2.07 billion or $4.29 billion, depending on the factors taken into account as highlighted in the report.
The report also contains other troubling observations. The consolidated revenues of the NNPC Group and expected remittances to the federation accounts cannot be accurately determined! Only $100 million – out of an aggregate sum of $1.85 billion attributable to the NNPC portion of Oil Mining Leases (OMLs) involved in the Shell Divestments related to the eight OMLs transferred to NPDC for an aggregate amount of $1.85 billion – had been remitted in relation to these assets. So, what happened to the balance?
The Attorney-General of the Federation and Justice Minister, Mohammed Adoke, had provided a legal opinion to the Senate Committee on Finance in which he declared that the transfers of the eight OMLs were well within the authority of the Minister of Petroleum Resources to make. The problem, however, as PWC noted, is that the OMLs were given away at heavily discounted prices! When the subject was broached at the Senate Committee hearing, the then NPDC managing director disclosed that it was a way of making it “easier for locals to enter the business”. The question is who exactly these faceless Nigerians are, particularly since PWC forensic auditors claim to have been denied copies of Deeds of Assignment for half of the OMLs in question!
The forensic report also uncovered massive irregularities in kerosene subsidy and possible errors in the computation of crude oil prices at the NNPC. The forensic report criticised the accounting and reconciliation system for crude oil revenues used by government agencies as “inaccurate and weak”.
I was shocked to read respected newspaper columnists – who obviously are yet to read the full report – lamenting that the NNPC audit report is a ‘smoking gun’ directly aimed at Petroleum Resources Minister, Diezani Alison-Madueke, as it would appear “the incoming government would want nothing less than ensuring that she leaves office with her reputation in tatters”. How and why does a commitment by the incoming administration to make the operations of NNPC more transparent translate to a “determination to deal with Diezani”?
For crying out loud, is Diezani the Group Managing Director/CEO of NNPC? It beggars belief that such rank ‘outsiders’ have chosen to weep louder than those whose principal responsibility is to administer the corporation and who ought to be directly in the line of fire. Crude oil accounts for not less than 95 per cent of the nation’s foreign exchange earnings and it is preposterous for anyone to even consider consigning such a damning forensic report to a drawer to gather cobwebs and dust. Buhari has my vote.
