Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
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.”