The Federal Ministry of Finance on Thursday accused the Nigerian National Petroleum Company Limited (NNPCL) of withholding financial records needed to respond to queries raised in the Nigeria Extractive Industries Transparency Initiative 2021 to 2023 Oil and Gas Sector Audit report.
The Permanent Secretary of the Ministry, Mr. Raymond Omachi, made the allegation while appearing before the Senate Committee on Public Accounts. The committee is probing several financial infractions flagged in the NEITI report.
One of the major issues highlighted was a $3 billion pre-export financing loan taken in 2012 to settle subsidy payments.
NEITI said recovery of the loan from monthly Federation revenue under the pre-export financing and Project Eagle agreement remains unclear.
Another query concerns $722.6 million paid in 2021 by Nigeria LNG to NNPC as dividends and interest earned by the Federation.
According to NEITI, the money was neither remitted to the Federation Account nor properly accounted for.
The audit also observed that none of the nation’s refineries was operational in 2021 despite N200 billion spent on them.
NEITI further flagged $221.283 million in overhead costs incurred by NAPIMS in 2021. The Ministry could not provide explanations for both.
Responding, Omachi said the Ministry was not directly involved in the transactions.
He stated that agencies involved, particularly NNPCL, have refused to cooperate by providing accurate records required for reconciliation.
“We don’t have direct involvement in all the issues raised and the required provision of financial records from the affected agencies, particularly NNPCL, NUPRC, is not there,” he told the committee.
To resolve the discrepancies, Omachi said the Ministry has engaged Arthur Andersen LLP to carry out a forensic audit of all the transactions.
He said the firm is expected to provide clarity for proper reconciliation.
The Chairman of the Committee, Senator Ibrahim Hassan Dankwambo, questioned when the forensic audit report would be ready, noting that the timeline had already been extended twice from six months to one year.
Dankwambo directed the Permanent Secretary to convene a joint meeting with NNPCL, NUPRC and the Ministry of Finance.
He stressed that the issues are in the public domain and being monitored internationally, adding that all records must be clarified in the interest of Nigeria.
