Wednesday, 15 January 2014

$10.8bn Oil Revenue: NNPC Provides Legal Grounds to Back Expenditures

b2292011-NNPC-Logo.jpg - b2292011-NNPC-Logo.jpgThe Nigerian National Petroleum Corporation (NNPC) has provided legal clarifications to back its expenditure of the disputed $10.8 billion crude oil revenue.
The corporation has also declared extant legal provisions in the laws that established it, which provided veritable grounds to justify all its expenditure processes in the course of operations.
Providing clarifications on the alleged unremitted $10.8 billion crude oil revenue to the Federation Account by the Central Bank of Nigeria (CBN), Group Executive Director, Finance and Accounts at the NNPC, Bernard Otti insisted that the corporation’s expenditures in the course of its operations were backed by Section 7 subsection A and B of the NNPC Act.
Otti who gave lucid details of how the corporation spent the controversial sum, explained that $8.49 billion was spent on subsidy claims within the period under review, while another $1.22 was spent on management and repairs of petroleum pipelines, which are constantly damaged by criminals across the country. In the same vein $0.72 billion was incurred on products and crude oil loses and $0.37 billion expended on holding the country’s strategic products reserves.

He stated that these expenditures were backed by law and that the NNPC had not erred in any way with regards to its use of the money, which the Governor of CBN, Sanusi Lamido Sanusi had notified President Goodluck Jonathan of and even recommend sanctions against possible culprits.
“Whatever expenditure that we have incurred in the discharge of the above national responsibilities are backed by the law setting up the corporation. Section 7 subsection A and B of the NNPC Act states inter-alia:
"The corporation shall maintain a fund which shall consist of: such monie as may from time to time be provided by the federal government for the purposes of this Act by way of grants or loans or otherwise howsoever; and such monies as may be received by the corporation in the course of its operations or in relation to the exercise by the corporation of any of its functions under this Act and from such fund there shall be defrayed all expenses incurred by the corporation,” Otti stated.
Frthermore, he said such expenditures by the NNPC, which gulped the money were incurred as part of its statutory responsibilities to the federal government and by extension Nigerians as the National Oil Company (NOC).
Sanusi had in the letter to Jonathan, which raised the alarm that NNPC was yet to remit as much as $49.8 billion to the Federation Account between the periods January 2012 and July 2013. His observations were however later found to be false following a reconciliatory meeting that involved the Minister of Finance, Dr. Ngozi Okonjo-Iweala, Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, the CBN Governor amongst others. In the course of the reconciliatory meeting, it was discovered that the actual amount not remitted into the Federation Account by the NNPC was $10.8 billion.
Source: ThisDayLive

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