Central Bank Governor Sanusi Lamido Sanusi yesterday accused the Nigerian National Petroleum Corporation (NNPC) of operating a racket through which the federation has been losing billions.
Speaking yesterday at the resumed Senate hearing on the alleged missing crude oil funds, Sanusi said the corporation has yet to account for $20 billion (equivalent N3.25 trillion) from the total $67 billion oil sales receipts from January 2012 to July 2013.
The CBN governor had written a letter to President Jonathan in September in which he said about $50 billion oil sales funds were not remitted to public coffers. Following the leak of the letter, the Senate asked its Finance Committee to investigative the issue.
When he first appeared before the committee in December, Sanusi said the unremitted amount was $12 billion, but Finance Minister Ngozi Okonjo-Iweala said it was $10.8 billion. Both of them said the figures were still being reconciled, and so the committee asked them to conclude the reconciliation and return.
In the meantime, NNPC announced that all the alleged missing funds had been accounted for and that the unremitted part was spent on fuel subsidy, pipeline repair and other operations.
The Senate committee, headed by Senator Ahmed Mohammed Makarfi, resumed sitting on the matter yesterday.
In his submission at the resumed hearing, Sanusi said NNPC was still to account for $12 billion out of domestic crude oils sales, $6 billion shipped on behalf of the NNPC and $2 billion “third-party financing”, making a total of $20 billion.
“It is now up to NNPC, given all the issues raised, to produce the proof that the $20 billion unremitted either did not belong to the Federation or was legally and constitutionally spent,” he said.
“There is no dispute that $20 billion out of $67 billion has not been paid into any account with the CBN.”
He added: “Our recommendation remains that this matter requires thorough independent investigation, as simple explanations will not suffice.”
Sanusi also spoke on the kerosene subsidy, for which NNPC said it spent part of the unremitted funds, saying that since President Umaru Yar’Adua eliminated such subsidy in July 2009 there has been no other presidential authorisation to the contrary.
Because of this, he added, what NNPC had been doing was running an unauthorised subsidy regime through which the “Federation Account loses $100 million every month to this racket.”
He challenged the corporation to show where they obtained authorisation to purchase kerosene at N150 per litre from federation funds and sell at about N40 per litre, “knowing fully well that this product sells in the market at N170-N220/litre.”
Sanusi also faulted claims by NNPC that part of the unremitted monies were spent on petrol subsidy, saying the corporation had previously announced that it had stopped deductions for subsidy from 2011.
“As from 2012, the directive was for NNPC to submit its papers to PPPRA, the relevant government agency set up and given the responsibility for verifying and paying subsidy claims,” he said.
“Having officially reported that it was not making deductions for fuel in 2012 and 2013, it is surprising that the GMD and GED of NNPC would now claim that $8.49 billion was used to pay for subsidy.”
He added: “I am convinced that a major source of revenue leakage from the system is NNPC’s unverified claims for subsidy and unilateral deduction from the Federation Account.”
Sanusi also alleged that part of the amount in contention was realised from proceeds of crude oil sales from two oil wells illegally handed over to two private companies.
“NNPC had said some of it does not belong to the Federation Account, so $6 billion is for NPDC but we have held the position that some of the crude shipped by the NPDC is shipped from oil wells that belonged to the federation,” he said.
Sanusi said he decided to present detailed evidence on unremitted funds because of “an orchestrated campaign” against the CBN in the wake of the leakage of his letter to Jonathan.
The Group Managing Director of the NNPC, Mr. Andrew Yakubu, who spoke to journalists shortly after the Senate hearing, dismissed Sanusi’s allegations, saying the CBN governor was ignorant of oil sector operations.
“Let me make this point clear, CBN is a banking outfit, not a petroleum outfit. It is therefore understandable why they keep making unsubstantiated claims, which a little understanding of the technicalities of the oil industry would have saved them from making,” he said.
“CBN is not an auditing outfit. But what it is doing is now auditing. We have no problem with auditing, but let the professionals, the certified bodies and agencies that are charged with this responsibility of auditing, to do their work.”
Yakubu said the issues raised by Sanusi were not fresh and would be eventually reconciled by the Inter Agency Committee established to settle the “missing funds” matter.
“We don’t have anything to hide, and we gave a detailed breakdown on the so-called $49 billion and we came out clearly to state the various streams that are associated with what he was talking about,” he said.
Earlier during the hearing, committee chairman Makarfi insisted that the Finance Ministry must submit details of subsidy payments for fuel and kerosene from January 2012 to December 2013, and details of deductions made by the corporation for petrol subsidy.
On the allegation that the NNPC was deducting money at source in the name of kerosene subsidy contrary to the 2009 presidential directive, Makarfi said he was aware that the National Assembly has been appropriating money for kerosene and petrol subsidy, which therefore legitimised it.
Makarfi also said neither the committee nor the stakeholders should constitute themselves into a “judge and jury but provide the committee with the facts and leave decisions to the Senate.
”The committee gave the parties involved week within which to settle their records and re-appear before it next week Thursday.
Source: Daily Trust
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