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60<br />

NEWS<br />

THE NATION TUESDAY, APRIL 28, 2015<br />

The multi-billion dollar scam in NNPC, by auditors<br />

Continued from page 4<br />

may still require third party<br />

liabilities to meet costs of operations<br />

and subsidies, and<br />

may not be able to make any<br />

remittances to FAAC.”<br />

It, therefore, recommended<br />

that the “NNPC model of operation<br />

must be urgently reviewed<br />

and restructured, as the<br />

current model, which has been<br />

in operation since the creation<br />

of the Corporation, cannot be<br />

sustained”.<br />

PwC also established that a<br />

“determination is required as to<br />

whether all or a portion of other<br />

costs not directly attributable<br />

to crude oil operations can be<br />

defrayed by NNPC”.<br />

It recommended that the<br />

NNPC be required to disclose<br />

details of all existing liabilities<br />

and impact on proceeds of future<br />

crude oil sales.<br />

PwC said: “Accordingly, all<br />

the Corporations costs, and<br />

those of its loss making subsidiaries<br />

have been defrayed in the<br />

analysis provided by the Corporation<br />

for the review period.<br />

However, the profit making<br />

subsidiaries and dividends received<br />

have been excluded from<br />

the analysis provided. This suggests<br />

that there are other sources<br />

of net revenues available to<br />

the Corporation not currently<br />

disclosed. A proper estimate of<br />

the actual potential excess remittance/under-remittance<br />

can<br />

only be arrived at if all revenues<br />

and all costs of the Corporation<br />

and all its subsidiaries are accounted<br />

for in a consolidated<br />

position. A detailed review of<br />

this was beyond the scope of our<br />

mandate.<br />

“We, therefore, recommend<br />

that NNPC be required to disclose<br />

the consolidated position<br />

of the Group and its subsidiaries,<br />

and expected remittances to<br />

the Federation accounts be determined<br />

from the available<br />

consolidated net revenues. Furthermore,<br />

the nature of costs<br />

that are allowable should be predetermined<br />

by all relevant<br />

parties.<br />

“We also recommend that the<br />

NNPC Act be reviewed as the<br />

content contradicts the requirement<br />

for NNPC to be run as a<br />

commercially viable entity. It<br />

appears the act has given the<br />

Corporation a ‘blank’ cheque<br />

to spend money without limit<br />

or control. This is untenable<br />

and unsustainable and must be<br />

addressed immediately. The<br />

Corporation should be required<br />

to create value, and<br />

meet its expenses entirely from<br />

the value created.<br />

“Proceeds from the FGN’s<br />

crude oil sales should be remitted<br />

entirely to the Federation<br />

Account. Commisions for the<br />

Corporation services can then<br />

be paid based on agreed<br />

terms.”<br />

It added: “We also expect that<br />

NPDC should remit dividends<br />

to NNPC and ultimately the<br />

Federation Account, based on<br />

NPDC’s dividend policy and<br />

declaration of dividend for the<br />

review period.We did not have<br />

access to NPDC’s full accounts<br />

and records and we have not<br />

ascertained the amount of costs<br />

and expenses which should be<br />

applied to the $5.11billion<br />

Crude Oil revenue (net of royalties<br />

and PPT paid) per the<br />

NPDC submission to the Senate<br />

Committee hearing in order<br />

to arrive at the Net Revenue<br />

(in line with the AG’s Opinion),<br />

which should be subjected<br />

to dividend remittance.We<br />

are also not aware that NPDC<br />

declared dividend for the review<br />

period.<br />

These matters need to be followed<br />

up for final resolution<br />

in terms of the NPDC Net Revenue<br />

(dividend) for Crude Oil<br />

relating to the transfers, PPT<br />

and royalty unremitted, and<br />

the transfer price valuation and<br />

remittance.”<br />

The auditors’ other findings<br />

include “possible errors in the<br />

computation of crude oil prices<br />

at the NNPC that resulted in<br />

a $3.6 million shortfall in incomes<br />

to the Federation Account.<br />

“The major beneficiaries were<br />

Fujairah Refinery - $805,545,<br />

NNPC (KRPC/WRPC) –<br />

$697,995 and NNPC (COMD) -<br />

$2,107,275. Subsequent to our<br />

identification of this issue,<br />

NNPC has amended the errors,<br />

and have reflected the amendments<br />

in the remittances to<br />

FAAC in October 2014.”<br />

The report uncovered iregularities<br />

in Kerosine subsidy. It<br />

said: “Our review of the DPK<br />

sales process revealed that<br />

NNPC sells DPK to bulk DPK<br />

marketers in Nigeria at N40.90<br />

per litre at a location on the<br />

coastal waterways (off shore<br />

Lagos). The expected/official<br />

regulated retail price of DPK in<br />

Nigeria is N50 per litre. This<br />

retail price of N50 comprises<br />

the ex-depot price of N34.51 and<br />

a margin of N15.49. NNPC<br />

should be required to explain<br />

the reason for selling DPK at<br />

N40.90, rather than the regulated<br />

Ex-depot price of N34.51. The<br />

Corporation should also be<br />

required to explain the reason<br />

for selling DPK to bulk DPK<br />

marketers at a location on the<br />

coastal waterways (off shore<br />

Lagos) rather than at the incountry<br />

depots.”<br />

The auditors criticised the accounting<br />

and reconciliation system<br />

for crude oil revenues used<br />

by government agencies as “inaccurate<br />

and weak”. “We noted<br />

significant discrepancies in<br />

data from different sources. The<br />

lack of independent audit and<br />

reconciliation led to over reliance<br />

on data produced from<br />

NNPC. This matter is further<br />

compounded by the lack of independence<br />

within NNPC as<br />

the business has conflicting interests<br />

of being a stand-alone<br />

self-funding entity and also the<br />

main source of revenue to the<br />

Federation Account,” they said.<br />

ment.<br />

Oluboyo’s confirmation took<br />

a short time after the speaker announced<br />

to members that he had<br />

been nominated by Mimiko.<br />

Oluboyo was later sworn in by<br />

the Chief Judge at an event attended<br />

by the Chief Imam of<br />

Akure, Alhaji Abdulakeem<br />

Mimiko gets new deputy as Ondo House sacks Olanusi<br />

Continued from page 4<br />

Olanusi’s Impeachment can’t stand, says APC<br />

Continued from page 4<br />

shall also cause any statement<br />

made in reply to the allegation<br />

by the holder of the office…”.<br />

Akinyelure said the above<br />

provision was not complied<br />

with or observed by the<br />

House of Assembly before<br />

the deputy governor was illegally<br />

or unconstitutionally<br />

removed from office.<br />

At the time the impeachment<br />

begun about fortnight<br />

ago, the vice chairman said<br />

the deputy governor had travelled<br />

out of the country for<br />

medical check-up, noting that<br />

the House did not serve the<br />

notice of impeachment on<br />

him or place it in any national<br />

daily as required by the<br />

1999 Constitution.<br />

Akinyelure also accused the<br />

Assembly of violating Section<br />

188(6) of the Constitution,<br />

which states that the holder of<br />

the office, whose conduct “is<br />

being investigated under this<br />

section shall have the right to<br />

defend himself in person or<br />

be represented before the<br />

panel on inquiry by a legal<br />

practitioner of his own<br />

choice”.<br />

As required under Section<br />

188 (6) of the 1999 Constitution,<br />

Akinyelure said the deputy<br />

governor was not offered<br />

the opportunity to defend<br />

himself, noting that he was<br />

not in the county when the<br />

impeachment proceedings<br />

started.<br />

He said the deputy governor<br />

“has not returned to Nigeria<br />

since he travelled out”.<br />

Akorede.<br />

Mimiko assured the people<br />

that the change would not have<br />

a negative impact on the state.<br />

The governor said the impeachment<br />

enjoyed the support<br />

of the state government and the<br />

people.<br />

PDP praised the Assembly for<br />

impeaching Olanusi.<br />

A statement by its Director of<br />

“He was not given opportunity<br />

to defend himself. And the<br />

panel has three months to conclude<br />

its assignment as indicated<br />

in section 188(7)(b), out<br />

of which it has not exhausted<br />

two weeks. Why is the panel<br />

acted in a hurry? Why can it<br />

follow due process?”<br />

The APC chieftain also accused<br />

the lawmakers of<br />

breaching Section 188 (2)(b) of<br />

the 1999 Constitution, which<br />

states that “the holder of such<br />

office is guilty of gross misconduct<br />

in performance of the<br />

functions of his office detailed<br />

particulars of which shall be<br />

provided.”<br />

Akinyelure said the impeachment<br />

did not comply<br />

with this provision, noting<br />

that it did not show substantive<br />

particulars of impeachable<br />

offences brought against<br />

him.<br />

On these grounds, the vice<br />

chairman argued Olanusi’s<br />

impeachment “left so much to<br />

be desired and that the decision<br />

of the panel would not<br />

stand.” The party would challenge<br />

illegal impeachment of<br />

the deputy governor,” Akinyelure<br />

said.<br />

The Ondo State APC also<br />

described the impeachment as<br />

“temporary.”<br />

In a statement by Publicity<br />

secretary Abayomi Adesanya,<br />

the party said it is laughable<br />

that the rubber stamp House<br />

of Assembly could hurriedly<br />

impeach the deputy governor<br />

and accept the nomination of<br />

another person in haste.<br />

The statement reads: “the<br />

Publicity, Ayo Fadaka, said for<br />

any governor to progress in his<br />

administrative duties, he must<br />

have a loyal and committed deputy<br />

governor.<br />

The PDP said: “Party takes absolute<br />

cognisance of the impeachment<br />

of Alhaji Ali Olanusi as Deputy<br />

Governor and commends the<br />

House of Assembly for its tenacity<br />

in prosecuting this action.<br />

impeachment of Alhaji Ali<br />

Olanusi as the deputy governor<br />

of Ondo State is temporary.<br />

The whole process of the<br />

impeachment was a sham and<br />

charade. How on earth will a<br />

deputy governor be impeached<br />

within five days?<br />

“It shows that there were<br />

unholy alliance among Governor<br />

Olusegun Mimiko,<br />

Chief Judge, Olasehinde Kumuyi<br />

and the governor’s<br />

stooges who call themselves<br />

lawmakers to embark on illegal<br />

process to impeach the<br />

deputy governor.<br />

“It was clear to the people<br />

that before the directive of the<br />

State Assembly Speaker to<br />

serve Olanusi the impeachment<br />

notice, the embattled<br />

deputy governor was not in<br />

the state. Without any court<br />

order, the Speaker directed<br />

them to paste the notice on<br />

the quarters of the deputy<br />

governor and this is unlawful.<br />

“The Chief Judge sets up a<br />

panel and a panel that was<br />

expected to sit for three<br />

months by giving room for<br />

fair hearing with the parties<br />

involved, only sat for five<br />

hours just because they have<br />

instructions for them to act<br />

upon.<br />

“We insist that the newly<br />

sworn-in Deputy Governor,<br />

Alhaji Laisisi Oluboyo, will<br />

only be there temporary as we<br />

still have faith in the judiciary<br />

that illegality perpetrated<br />

by the State Assembly will be<br />

set aside very soon”.<br />

“It is important to declare that<br />

the Parliament displayed its commitment<br />

to good governance that<br />

will be bereft of undue encumberances<br />

by removing from office a<br />

man who not only discharge his<br />

responsibilities with levity and<br />

mostly in abeyance, but also view<br />

with disdain his oath of office to<br />

bear true allegiance to the government<br />

he was an integral part of.”

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