Audit-Report-on-NNPC

Investigative Forensic audit of crude oil revenues and remittances by NNPC (January 2012 – July 2013)
Description
Amount
Official Ex-Depot Price from January 2012 N81.51
Actual Ex-Depot Price applied for some discharges in February N49.51
2012
Volume affected (Litres) 174,449,778
Adjustments for the application of N49.51 for discharges between N5,582,392,896
February 2012 and July 2013)
Using $1 = N154.87, PMS Subsidy Over Statement $36,045,669
Table D6: Re-computation of the Subsidy advised by PPPRA using old ex-depot price (N49.51) in February 2012;
Source: PPPRA Payment Advice; PPPRA Pricing Template, PwC Analysis
4.4.4.6. DPK Subsidy Over-Charge of $203,539,968 by NNPC
Our review of a sample of the copies of the Pro Forma Invoices (PFIs) issued to the other
marketers 51 of DPK across different geopolitical zones of Nigeria, revealed that the Other
marketers bought DPK from NNPC/PPMC Offshore Lagos 52 at N40.90.
The Other marketers are thereafter required to incur the following expenses:
Description
Amount N
Lightering expenses 4.07
NPA Charge 0.68
Jetty Depot Throughput 0.80
Storage Charge 3.00
Minimum cost to Other marketers 8.55
Table D7 – Costs borne by other marketers after purchase of DPK from PPMC
Our assumptions for the calculation of the over charge of subsidy are as follows:
1. Per our review of PPMC’s Schedule of PMS and DPK imports obtained from PPMC,
3,686,811,097 litres of DPK were transferred through Shuttle to Shuttle (STS) system to
other marketers between January 2012 and July 2013.
2. Subsidy is calculated as follows:
Under-recovery/Subsidy = Landing Cost – Ex-Depot Price
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3. Per PPPRA’s template, Landing Cost also includes Lightering expenses (N4.07), NPA
charges (N0.68), Jetty Throughput Charge ((N0.80) and Storage Charges (N3.00).
4. NNPC/PPMC confirmed to us that the Other marketers incur Lightering expenses
(N4.07), NPA charges (N0.68), Jetty Throughput Charge ((N0.80) and Storage Charges
(N3.00) on their own after purchase of DPK from NNPC/PPMC offshore Lagos.
5. PPPRA as well as PPMC had included the costs in (3) above in their computations of the
Landing Costs.
6. Using PPPRA’s template, the total of the other costs incurred by the other marketers, as
reflected in (3) above is N8.55.
51
See Appendix 6.1.26. Summary of DPK Purchases from PPMC by Other marketers between January 2012 and July 2013
52
Offshore Lagos – A location within the Nigerian waterways before the Nigerian Ports in Apapa
Confidential information for the sole benefit and use of the <strong>Audit</strong>or-General for the Federation.
PwC 73