Oil
$10.8billion Not Missing, NNPC insists
By Joseph BAMIDELE
ABUJA – The issues surrounding the allegation of unremitted $49.8bn against the Nigerian National Petroleum Corporation (NNPC) have since been explained but it appears the initial dust raised in the process is yet to settle.
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, $39bn 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 utilization.
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.’
The Nigerian National Petroleum Company Limited (NNPC) has unveiled a bold strategy to reduce methane emissions in the oil and gas sector by 60% by 2031, with an ultimate goal of achieving net-zero emissions by 2060.
This announcement reinforces Nigeria’s leadership role under the Global Methane Pledge initiative and its commitment to tackling climate change.
The Group Chief Executive Officer of NNPC, Mele Kyari, disclosed these plans during a meeting on Thursday with Robert Leahman, the U.S. State Department’s Global Methane Program Manager, and a delegation from Deloitte.
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The discussions, held at the NNPC Towers in Abuja, focused on collaborative efforts to reduce methane emissions through innovative and sustainable practices.
“Reducing methane emissions is not just an environmental necessity but also a strategic imperative for Nigeria’s energy transition. We are leveraging partnerships to adopt global best practices and innovative solutions,” Kyari stated.
Key among these efforts is a pilot project in the Niger Delta, aimed at establishing emissions baselines, mitigating methane leaks, and promoting sustainable operations across Nigeria’s energy sector.
The project, a partnership between NNPC, Deloitte, and the U.S. Bureau of Energy Resources, will utilize data-driven methodologies to pinpoint and address methane hotspots.
Robert Leahman commended Nigeria’s proactive stance, describing it as a benchmark for other nations on the continent.
“Nigeria’s leadership under the Global Methane Pledge sets a standard for the continent. These initiatives will not only help reduce emissions but also drive sustainable development in the energy sector,” he said.
Kyari highlighted the broader benefits of addressing methane emissions, noting its significance for both environmental protection and economic efficiency.
“This collaboration is a game-changer. By addressing methane leaks, we’re reducing waste, saving costs, and protecting the environment. It’s a win-win for our economy and the planet,” he added.
In a strategic move to revitalize Nigeria’s oil and gas sector, the Federal Government has unveiled two key fiscal incentives aimed at attracting investment and enhancing energy security.
The announcement was made by Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy on Wednesday.
The first initiative, the Value Added Tax (VAT) Modification Order 2024, introduces critical exemptions for essential energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.
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These exemptions are designed to reduce living costs for Nigerians, promote energy security, and accelerate the transition to cleaner energy alternatives.
The second initiative, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, offers new tax relief options for deep offshore exploration projects.
This measure aims to position Nigeria’s deep offshore basin as a premier destination for international oil and gas investments, boosting the country’s appeal to foreign investors.
These reforms are part of a broader set of policy initiatives, known as Policy Directives 40-42, endorsed by President Bola Ahmed Tinubu.
The directives reflect the administration’s commitment to fostering sustainable development in the energy sector and enhancing Nigeria’s competitive edge in the global oil and gas market.
By Yemie Adeoye
NIGERIA’s President Bola Tinubu has announced that the protracted ExxonMobil-Seplat upstream oil divestment will be formally approved by the Minister of petroleum within a matter of days, just as he announced his government’s intention to expand the Compress natural Gas, CNG buses initiative.
The President who stated this during his Independence day nationwide broadcast stated that the move is in line with his administration’s commitment to free enterprise, free entry and free exit in investments which is the hallmark of his administration investment policy.
“Fellow compatriots, our administration is committed to free enterprise, free entry, and free exit in investments while maintaining the sanctity and efficacy of our regulatory processes. This principle guides the divestment transactions in our upstream petroleum sector, where we are committed to changing the fortune positively. As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.”
The President also seized the opportunity to plead with Nigerians to be patient with his administration’s reform policies. “As your President, I assure you that we are committed to finding sustainable solutions to alleviate the suffering of our citizens. Once again, I plead for your patience as the reforms we are implementing show positive signs, and we are beginning to see light at the end of the tunnel”.
“Our energy transition programme is on course. We are expanding the adoption of the Presidential Initiative on Compressed Natural Gas for mass transit with private sector players. The Federal Government is ready to assist the thirty-six States and FCT in acquiring CNG buses for cheaper public transportation.
Fellow Nigerians, while we are working to stabilise the economy and secure the country, we also seek to foster national unity and build social harmony and cohesion. Our economy can only thrive when there is peace”. he enthused.
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