NNPC Failed To Remit $11.6bn In LNG Revenue To State Treasury, Says NEITI

SAN FRANCISCO, June 10, (THEWILL) – The Nigerian National Petroleum Corporation (NNPC) has failed to remit $11.6bn in dividends, loan and interest repayments earned through exports from the Bonny LNG plant, an audit conducted by the Nigerian Extractive Industry Transparency Initiative (NEITI) has revealed.

NEITI said late Tuesday that the audit examined transactions from 1999-2012.

It said in a statement that the earnings represent NNPC’s share of 49% equity ownership in Nigeria LNG Ltd., owner of the six-train, 22 million mt/year Bonny LNG plant.

“In the course of NEITI’s audit, the NNPC was unable to provide any evidence that the funds were remitted to the Federation Account as required by law,” said Zainab Ahmed, NEITI’s executive secretary.

The agency urged the new administration that took office May 29 to ensure the recovery of the revenue, especially given the “the new administration is in dire need of funds to tackle the complex problems facing the nation.”

NNPC said in an explanatory note to NEITI seen by Platts Wednesday that it has “presidential approval to sequester the NLNG dividend to fund all gas-related projects.” It said an inter-ministerial committee was working on reconciling the revenues, Platts said in its report.

NNPC holds 49% equity in NLNG on behalf of the Nigerian government, with partners Shell (25.6%), Total (15%) and ENI (10.4%.)

NLNG exports average of 300 cargoes/year of LNG to buyers in Europe, America and Asia. It said in May it earned about $30 billion in dividends from gas exports over the past 15 years and paid about Naira 220 billion ($1.1 billion) in taxes alone to the Nigerian government in 2014.

Nigerian security agencies are currently probing NNPC’s crude swaps for oil products and offshore crude processing agreements with international oil trading groups, for which various sources said the government lost several billions of dollars in potential revenue.