NEITI ready to help NNPC in tracing NLNG’s unremitted $11.6b

KACHIKWU, NNPC GMD

The Nigerian Extractive Industries Transparency Initiative (NEITI) has pledged to assist the new management of the Nigeria National Petroleum Corporation (NNPC) led by Dr Emmanue Ibe Kachikwu recover the $11.6 billion unremitted proceed from the Nigerian Liquefied Natural Gas (NLNG) Ltd.

NEITI, in a statement signed by its Director of Communications, Dr. Orji Ogbonnaya Orji, assured the new NNPC management of its readiness to help it recover the unremitted funds.”We in NEITI are ready to offer any advise,   support, partnership and cooperation based on mutual respect to the new NNPC that is emerging under the leadership of Dr. Ibe Kachikwu. This is to ensure that the NNPC conforms fully to the requirements of transparency and accountability as enshrined in the NEITI act of 2007 and the principles of the global EITI.

“Both the EITI and NEITI stand firmly with Nigerian citizens that revenues from oil, gas and mining should support national development and reduce poverty in our country. We are particularly encouraged by the recent pronouncement of the Dr Ibe Kachikwu on remittances of all NLNG dividends directly to the Federation account as required by law and demanded by all NEITI Reports,” NEITI said.

According to Dr. Orji, the corporation’s implementation of the pending remedial issues under a plan already developed by NEITI and the Inter Ministerial Task Team (IMTT) would be beneficial to the country.

He listed such issues to include: inadequate metering infrastructure for accurate measurement of crude; the onerous Joint Venture (JV) cash call regime; inefficient cost determination; urgent resolution and review of pricing issues related to expired Memorandum of Understanding (MoU) and legal agreements with oil companies that have huge revenue loss implications for the nation.

According to the NEITI spokesman, other challenges that needed to be fixed included: “huge costs of fuel subsidy; crude oil swap and products exchange agreements; repair of the refineries; oil theft; review of existing fiscal regime in the industry; automation of record keeping and the politics of acquisition and assignments of oil blocks  by discretion among others.”

NEITI also said that it supports the task given to the ad-Hoc Committee of five raised by the National Economic Council (NEC) to look into allegations of sharp practices in the revenue-generation agencies of government.

The panel, chaired by Edo State Governor Adams Oshiomhole announced KPMG and the Pricewaterhouse Coopers as consultants to forensically audit the books of the agencies. Other members of the panel are governors: Nasiru El-Rufai (Kaduna); Akinwunmi Ambode (Lagos); Udom Emmanuel (Akwa Ibom) and Ibrahim Dakwambo (Gombe).

NEITI noted that one important issue it planned to help the committee uncover, if given opportunity, will be how the government to recover over $7 billion owned by oil companies.

It said these disclosures are contained in NEITI audit reports as cases of under-payments; under-assessment’s arising from subjective interpretation of MoU and tax laws. “We have no doubt that our contributions will add value to the work of the committee,” NEITI said.

The watchdog agency also endorsed two other decisions taken by President Muhammed Buhari’s sweeping reforms –   the recent directive on operation of a Single Treasury Account (STA) by all Ministries, Departments and Agencies (MDAs).

The statement read: “NEITI’s interest in the new policy was borne out of the fact that over 70 per cent of the funds involved are directly or indirectly generated from extractive industries”.

“We find the singly treasure account policy, a vital move and a major reform – driven decision that would help eliminate fraudulent practices  created by multiple revenue  accounts by government agencies,” it adds.

NEITI also said it welcomed President Buhari’s decision to set up a Presidential Advisory Committee on Anti-Corruption under the chairmanship of by Prof. Itsay Sagay, a Senior Advocate of Nigeria (SAN). “The work of this committee is not only timely but very useful. It is a good platform for all the 21 anti-corruption agencies, coordinated by the Technical Unit on Governance and Anti-Corruption (TUGAR) under the chairmanship of NEITI, to share information and offer informed advice based on experiences over the years.

“It is our expectation that Prof Sagay’s committee will provide NEITI and all the agencies under the Inter – Agency Task Team (IATT) an opportunity to make presentations.

“In view of the huge potentials in the mining and solid minerals sector, we urge President Buhari to please extend the on-going reforms to that sector. From NEITI’s scoping study and independent audit reports, this sector has the potential to yield more revenues for the country than oil, if given the attention it deserves.

“One urgent step required now is to immediately check the activities of illegal miners many of whom are foreigners that have taken over the solid minerals sector without authorisation.

“Finally, NEITI’s view remains that for these sweeping reforms initiated at the Federal level to yield results and impact on the economy, state governments need to be encouraged to find enough reasons to step down the on-going reforms at the state level.

“This is important because of the wider implications in the revenue sharing formula, resource allocation, and efficient utilisation to meet the overall strategic national development objectives.”

By Olisemeka Obeche

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