Audit-Report-on-NNPC
Audit-Report-on-NNPC
Audit-Report-on-NNPC
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Investigative Forensic audit of crude oil revenues and remittances by <strong>NNPC</strong> (January 2012 – July 2013)<br />
3.1. Detailed Timeline of Events<br />
The assignment follows a timeline of events beginning with a letter in September 2013 by the former<br />
Governor of CBN, HRH Mallam Sanusi Lamido Sanusi to the President of the Federal Republic of<br />
Nigeria, Dr Goodluck Ebele J<strong>on</strong>athan (GCFR) stating (am<strong>on</strong>g other allegati<strong>on</strong>s), that from January<br />
2012 to July 2013, <strong>NNPC</strong> had lifted $65bn worth of crude <strong>on</strong> behalf of the FGN but remitted <strong>on</strong>ly<br />
$15bn, with $49.8bn outstanding. The history of allegati<strong>on</strong>s is shown in the table below:<br />
Date<br />
Event<br />
25 September 2013 Sanusi Lamido Sanusi, former CBN Governor, writes a letter to the President stating<br />
that from January 2012 – July 2013, <strong>NNPC</strong> had lifted $65bn worth of crude <strong>on</strong> behalf<br />
of the FGN but remitted <strong>on</strong>ly $15.2bn, thus $49.8bn was outstanding.<br />
13 December 2013 The former GMD <strong>NNPC</strong> (Andrew Yakubu) resp<strong>on</strong>ds that no m<strong>on</strong>ey is missing. A<br />
revenue rec<strong>on</strong>ciliati<strong>on</strong> meeting was set up by the FGN to look into the allegati<strong>on</strong>s.<br />
The meeting had representatives from:<br />
(i) CBN (ii) <strong>NNPC</strong> (iii) Department of Petroleum Resources (DPR)<br />
(iv) Federal Inland Revenue Service (FIRS)<br />
(v) Office of the Accountant General of the Federati<strong>on</strong> (OAGF)<br />
(vi) The Budget Office of the Federati<strong>on</strong><br />
(vii) Federal Ministry of Finance<br />
(viii) Federal Ministry of Petroleum Resources.<br />
18 December 2013 After the rec<strong>on</strong>ciliati<strong>on</strong> meeting, a joint press statement was issued by all the parties<br />
as follows:<br />
Actual value of crude lifted over the period was $67bn which was accounted for as<br />
follows:<br />
(i) Revenues which directly accrued to <strong>NNPC</strong> (for the Federati<strong>on</strong> Account) of $14bn<br />
(ii) Additi<strong>on</strong>al revenues lifted by <strong>NNPC</strong> <strong>on</strong> behalf of other parties as follows:<br />
- FIRS ($15bn) - DPR ($2bn)<br />
- NPDC ($6bn) - Other third party financing ($2bn)<br />
(iii) Domestic crude lifted by the <strong>NNPC</strong> ($28bn)<br />
The Ministry of Finance acknowledged that all crude lifted was remitted apart from<br />
domestic crude remittances with a shortfall of $10.8bn, made up of:<br />
i)Unpaid subsidy claims – USD 8.77billi<strong>on</strong><br />
(ii)Holding costs of strategic reserves – USD 0.46billi<strong>on</strong><br />
(iii)Crude oil and product losses – USD0.76billi<strong>on</strong><br />
(iv)Pipeline and management costs – 0.91billi<strong>on</strong><br />
CBN Governor stated that the shortfall is $12bn because, of the $28bn due from the<br />
domestic crude, <strong>NNPC</strong> had <strong>on</strong>ly remitted $16bn. <strong>NNPC</strong> insisted that the shortfall is<br />
$10.8bn and the difference was due to $1.2bn subsidy payments it claimed to have<br />
made between Jan-Mar 2012 (relating to October – December 2011 discharges), and<br />
which had been certified by the PPPRA. CBN did not recognize it as no documents<br />
were provided by <strong>NNPC</strong> to support the explanati<strong>on</strong>.<br />
Vanguardngr<br />
C<strong>on</strong>fidential informati<strong>on</strong> for the sole benefit and use of the <str<strong>on</strong>g>Audit</str<strong>on</strong>g>or-General for the Federati<strong>on</strong>.<br />
PwC 32