Fidelity bank card banner Emerald Energy Institute Camano banner

NNPC withheld $4.2b proceeds in second half of 2015: Report

By News Express on 11/04/2016

Gmail icon

Views: 2,083

A new analysis from the Natural Resource Governance Institute (NRGI) has shown that the Nigerian National Petroleum Corporation (NNPC) remitted only $2.1 billion out of the $6.3 billion it made from the sale of oil and gas during the second half of 2015.

Though, the corporation said that it had commenced meeting with some officials of the NRGI toward reviewing the report, the analysis indicates that NNPC withheld $4.2 billion during the period. The international watchdog said that the NNPC continued to withhold revenues from sale of oil and gas worth billions of dollars from the treasury without effective rules or oversight.

In the report, the NRGI said in the second half of 2015, NNPC’s sales of export crude, domestic crude and oil from its subsidiary Nigerian Petroleum Development Company (NPDC) totalled $6.3 billion. The NRGI noted that of this amount, only $2.1 billion entered the Federation Account. “As the government continues its reform of the oil sector, we recommend that it establish a clear, legally enforceable rule governing which revenues NNPC can keep and how they can be spent. Otherwise, oil sector corruption and waste could return to their prior devastating levels once the president leaves or prices rise.” It stated that NNPC therefore retained 66 per cent of proceeds from these three types of sales, which was 12 per cent higher than the withholdings under Goodluck Jonathan in 2013 and 2014.

“Some of NNPC’s withholdings cover known costs, notably its share of joint venture operating expenses. The corporation has not fully explained others; especially revenues retained from domestic crude and NPDC sales.

“NNPC spending on this scale raises questions about fiscal responsibility–especially at a time when public finances are stretched and the Federal Government is looking to fund more of its budget with debt. Recent announcements on NNPC reforms and the latest drafts of the Petroleum Industry Bill do not adequately address how NNPC and the state will share revenues in future,” the report stated.

The NRGI further said: “While NNPC does not disclose enough information to conclusively say what happens to the remainder, we can offer some tentative explanations for each of the three types. They paint a stark picture of how expensive the Nigerian oil sector has become to the nation. Of the $1.4 billion in regular export crude sales, the full amount went to pay JV cash call liabilities, rather than entering the government budget. This is in addition to the $1.1 billion worth of oil that NNPC routed through alternative finance arrangements during this period to pay JV debts. It makes some sense that operating expenses from the JVs now consume a larger relative share of NNPC’s oil sale proceeds, because operating costs have not dropped as precipitously as oil prices have over the last two years. However, the fact that operating costs consumed all the returns from an entire class of oil sales dramatically illustrates the unaffordability of the JVs”.

The agency added that NNPC sold oil from NPDC-owned fields worth $1.5 billion in the latter half of 2015, saying that some of this oil may have gone to the subsidiary’s strategic alliance partners, two companies that are paid in oil for purportedly shouldering some of NPDC’s financial burdens.

“NPDC may keep the rest, or transfer it to its parent, NNPC. The subsidiary produced a sizeable 110,000 barrels of oil per day in the last six months of 2015. But we have seen no evidence that proceeds from NPDC oil sales enter the treasury. Instead, they are spent in an unknown manner. •Sourced from The Guardian.

Source News Express

Posted 11/04/2016 2:06:03 PM





You may also like...
50 pct of children in 12 northern states...

Health benefits of tiger nuts

Daring Nigerian drug trafficker escapes from Indian cell...

All set for ‘Olamide Live’ concert in Lagos...

Kaduna State Govt. to sack workers

Foreign Investments in oil and gas free zones...

Principal charges Master Care Int’l School students to...

Plateau Gov. pledges support for digitization in broadcasting...

Buhari shuns meeting with Bauchi, Adamawa governors

Breaking: President Jonathan declares for second term, promises...

Suspected herdsmen kill 16 farmers in Benue

Korea award scholarship to 13 Nigerian govt officials...


Latest News 2 killed as gunmen storm Rivers communities Rape case: Fatoyinbo files preliminary objection, says Busola’s case ‘filed out of time’ Akpabio announces plans for industrial clusters in Niger Delta Magashi and challenges of national security Delta tribunal verdict fair, just, well-deserved, says Oyovbaire •Condemns court action as unnecessary Hostage regains freedom after 4 years in pirates’ custody PDP heads for Appeal Court as tribunal upholds Governor Masari’s re-election NNPC unveils plans to revamp refineries from January 2020 Obi advises Nigerian universities to look inwards No meeting between Dickson and Sylva — PDP Youth Network Okowa to Christians: Dedicate your life to serving God Another perspective on xenophobic attacks, By Odimegwu Onwumere


Most Read NUDE PHOTO OF OMOTOLA JALADE-EKEINDE surfaces online (542,581 views) Nigerian female sex addict opens up, says ‘I like it with both men and women’ (443,873 views) Shameless Genevieve Nnaji exposes breasts in public (390,339 views) Finally named: The full list of friends of Nigerian female sex addict who prowled Facebook (327,217 views) OLUMBA OLUMBA OBU (the one who called himself God) IS DEAD (295,368 views) Igbo scholar disgraces Femi Fani-Kayode •Demolishes claims on Igbo/Yoruba history with facts and figures (254,027 views) Breaking News: POPULAR REVEREND CONVERTS TO ISLAM in Kaduna (Nigeria) (250,328 views) 10 cars more expensive than Jets (239,093 views) OBJ’s son reported dead in Lagos plane crash •Names of more victims emerge (232,020 views) My wasted years in Olumba Olumba Obu’s Evil Brotherhood (218,004 views) Lagos plane crash: Journalist releases victims’ names (196,286 views) THE FINAL DISGRACE: Igbo scholar unleashes more facts about Igbo/Yoruba history, finishes off Femi Fani-Kayode with second article (193,858 views)


CBN milk production

CBN banner advert

UBA Wise Savers Promo


Categories Advertorials (3) African Press Organisation (81) Art & Literature (102) Business & Economy (4,454) Business Verdict (80) Columnists (1,113) Complaints & Requests (96) Enterprise & Opportunities (215) Entertainment (666) Features (815) Global Business Monitor (445) ICT Monitor (63) International (3,972) Interview (203) Live Commentary (30) Love Matters (171) Maggie's Blog (418) News (51,603) Opinion (1,364) Pidgin (17) Politics (11,469) Religion (1,103) Sports (2,173) Stock Watch (39) AMA & Al Jazeera Global Update







APO Group Partner




GOCOP Accredited Member

GOCOP Accredited member



Africa Media Agency and Al Jazeera