Audit-Report-on-NNPC

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Investigative Forensic audit of crude oil revenues and remittances by NNPC (January 2012 – July 2013) The table below outlines NNPC’s reconciliation of the differences between revenues from crude oil liftings and cash remitted to the Federation accounts – January 2012 to July 2013 (review period) Explanations extracted from NNPC’s presentations to the Senate Committee Item $’ billion Comment Revenue generated 67.00 Revenue from the sale of crude oil during the review period. Cost associated with the maintenance of strategic reserve Crude oil and product losses (0.46) Pipeline maintenance and management costs (0.91) Other third party financing NPDC Subsidy payments (DPK, PMS, Q4 2011) Total Remitted Demurrage and other costs incurred due to delay of vessels ready to discharge refined petroleum products and costs relating to storage of strategic reserves of finished petroleum products during the review period. (0.76) Value of crude oil and petroleum products lost as a result of pipeline vandalism and theft during the review period. (2.00) (6.00) Deduction of direct costs incurred by NNPC to safeguard, repair and maintain the country’s petroleum products pipelines during the review period. Due to liquidity challenges, NNPC was funding Exploration and Production (Capex and Opex) using external lenders. In this instance, the NNPC and its Joint Venture (JV) partners form a Special Purpose Vehicle (SPV) which sources funds externally. The SPV repays the lender using crude oil from production. This deduction reflects the value of crude that was allocated and deducted to repay the lenders during the review period. This represents revenues generated by NPDC oil blocks. These revenues were withheld by NPDC during the review period, and not remitted into the Federation Accounts. (9.97) This represents amounts deducted by the NNPC for subsidy claims on PMS and DPK imports during the review period. Vanguardngr 47.00 Source: NNPC GMD’s Submission to the Senate (Exhibit A1), PwC Analysis This represents the net amount paid into the Federation Accounts out of the revenues generated during the review period. Confidential information for the sole benefit and use of the <strong>Audit</strong>or-General for the Federation. PwC 10
Investigative Forensic audit of crude oil revenues and remittances by NNPC (January 2012 – July 2013) 2. Executive Summary (The executive summary is not a stand alone document, and must be read with the full report) Vanguardngr Confidential information for the sole benefit and use of the <strong>Audit</strong>or-General for the Federation. PwC 11
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