NNPC Says $10.8billion Not Missing

Source: pointblanknews.com

While the issues surrounding the allegation of unremitted $49.8bn against

the Nigerian National Petroleum Corporation (NNPC) have since been

explained, it appears the initial dust raised in the process is yet to

We are therefore constrained to respond and clarify the issues once again

to help those who do not yet understand the clarification made earlier by

the Coordinating Minister of the Economy and Minister of Finance, Dr.

Ngozi Okonjo-Iweala; Minister of Petroleum Resources, Mrs. Diezani

Alison-Madueke; Governor of the Central Bank of Nigeria (CBN), Mallam

Sanusi Lamido Sanusi; and Group Managing Director of the Nigerian National

Petroleum Corporation (NNPC), Engr. Andrew Yakubu at a joint press

conference which was widely reported in the media.
For the avoidance of doubt, there was no where it was stated or admitted

by any of the parties in the course of the press conference or anywhere

else that the sum of $12bn or $10.8bn out of the alleged unremitted

$49.8bn is“ missing''.The truth of the matter is that as at the time of

the press conference, $30bn of the alleged unremitted oil revenue had been

reconciled by all the parties involved. Dr. Okonjo-Iweala did explain that

the reconciliation was an ongoing process and that the balance of $10.8bn

is still being reconciled.
At no time did anybody, neither the Coordinating Minister of the Economy

nor the CBN Governor, say that the outstanding $10.8bn was “missing''. It

is simply curious how some section of the media are not prepared to see

the difference between the two positions – reconciliation in progress

versus money missing. These two positions are simply not the same thing no

matter the angle from which anyone chooses to see them.

Having made that point, it is also pertinent to further clarify that NNPC

as a national oil company is saddled with certain onerous responsibilities

that other oil companies are freed from. For instance, as the supplier of

last resort, NNPC has the responsibility of ensuring that there is

adequate supply of petroleum products whether the market is favourable or

not. The yet to be reconciled $10.8bn can be located in the expenses on

some of the responsibilities which the Corporation carries out on behalf

of the Federal Government with respect to the domestic crude oil

One of such issues is the unpaid subsidies on kerosene and premium motor

spirit (PMS). It would be recalled that Dr. Okonjo-Iweala was earlier in

2013 reported to have stated that she has not paid any subsidy on kerosene

since she assumed office. The truth of the matter is that since 2007 when

the late former President Umaru Yar'Adua reviewed the prices of petroleum

products following the general strike in protest against the price hike by

his predecessor, the issue of subsidy payment on kerosene was left hanging

and NNPC was mandated to continue to sell the product at a subsidized rate

of N50 per litre.
Since then, not a dime has been paid to the Corporation as subsidy on the

product. It is also on record that since January 2012 NNPC has been

importing the bulk of the PMS used in the country. NNPC has successfully

kept the nation wet with products, especially PMS, these past two years as

can be verified from the absence of queues at petrol stations during the

end of year festivities. So the Corporation is left to bear these

responsibilities on behalf of the Federal Government and these costs are

part of the yet-to-reconciled balance.
Another area of huge expenditure on behalf of the Federal Government is

the maintenance of national strategic reserves for petroleum products. At

every point in time round the year, NNPC maintains huge petroleum products

reserves in the national territorial waters as a result of pipeline

vandalism which has made access to most of the inland storage facilities

impossible. Though all hope is not lost in this regard as the Corporation

has since launched an aggressive depot rehabilitation and pipeline

recovery exercise with amazing results so far.
However, for the purpose of strategic reserve, at the rate of 40 million

litres of PMS national consumption per day, NNPC maintains about 32 days'

sufficiency of petrol. The cost incurred in this mandate is also part of

the $10.8bn yet-to-be-reconciled outstanding figure.

A third component is the cost of pipeline vandalism and oil theft. These

are security issues. While we acknowledge that successive governments and

their agencies like the military, police, NSCDC etc have been trying hard

to create an enabling environment for the protection of our key

infrastructure, including pipelines jetties, depots etc, the sheer volume

of vandalism and theft is just enormous. Our over 5000 kilometers of

pipelines have been prone to incessant attacks. The cost of repairs each

time the pipelines are hacked is also an issue. All these make up the

yet-to-be-reconciled balance of $10.8bn.
All the parties involved in the reconciliation process are aware of these

facts and the figures are being thoroughly scrutinized. At the end of the

day, they will make their findings public as they did last time. It is

therefore incorrect for anyone or medium to continue to misinform the

public that the sum of $10.8bn or $12bn of oil revenue is “missing''.

It is important for public commentators and the media to stick to the

facts and avoid undue sensationalism in the process of analyzing and

interpreting the news. Our commentators owe our dear country a duty to

avoid misinforming and misleading our people so that together we can move

Nigeria forward.
Once again, we restate the fact that “No money is missing.''