NEITI audit report pitches Finance Ministry against NNPCL

• As queries over $3bn contract agreement, $722m LNG dividends remain unresolved

By Haruna Salami

The Federal Ministry of Finance has accused the Nigerian National Petroleum Company Limited (NNPCL) of withholding key financial records required to address infractions highlighted in the 2021–2023 Nigeria Extractive Industries Transparency Initiative (NEITI) Oil and Gas  sector audit report.

Appearing before the Senate Public Accounts Committee (SPAC) on Thursday, the Permanent Secretary of the Ministry, Mr. Raymond Omachi, explained why the Ministry could not satisfy several financial queries raised by NEITI.

Key unresolved issues in the audit report include: $3 billion pre-export financing loan – 2012 loan taken to settle fuel subsidy payments, where NEITI noted that the recovery process from monthly Federation proceeds under the Pre-Export Financing and Project Eagle Agreement remains unclear.

Also, there is $722.6 Million NLNG dividends- sums paid to the NNPC by Nigeria Liquefied Natural Gas (NLNG) in 2021 as dividends and interest earned by the Federation, which were neither remitted to the Federation Account nor properly accounted for.

Furthermore, N200 billion refinery expenses- spending on refineries in 2021 despite none of them being operational during that period.

Additionally, there is $221.28 million overhead costs – unexplained overhead expenses incurred by the National Petroleum Investment Management Services (NAPIMS) in 2021.

Responding to the panel, Omachi stated that the Ministry had no direct involvement in these transactions and blamed non-cooperation from key agencies for the lack of records.

“We don’t have direct involvement in all the issues raised, and required financial records from the affected agencies, particularly NNPCL, NUPRC, etc., are not there,” Omachi said.

He added that the Ministry has engaged Arthur Andersen LLP to conduct a forensic audit to reconcile the transactions, though committee members questioned why the report remains delayed after its timeline was extended from six months to a year.

Omachi appealed to the SPAC to exercise its legislative powers to compel the NNPCL, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and other relevant bodies to face the committee alongside the Finance Ministry.

“We are having challenges bringing them to the table so that we can resolve these issues.

“We are ready to sit with them here so you can hear directly from them,” he urged.

The Committee Chairman, Senator Ibrahim Hassan Dankwabo (Gombe North), granted the request and instructed the Ministry to review its interim audit report while scheduling a joint session with the NNPCL, NUPRC, and other implicated agencies.

Dankwabo emphasized the importance of resolving the issues transparently, noting that the audit findings have drawn global attention.

He said: “These issues are being followed by the international community.

“They are in the public domain and are being monitored across the world.

“ If there are records or issues that need to be clarified and properly put in order, we should do so in the interest of our country.”