Cumulative unremitted revenue from domestic crude oil sales by the Nigerian National Petroleum Corporation, NNPC, stood at about N3.878 trillion as at December 31, 2015, a report by the technical sub-committee of the Federation Accounts Allocation Committee, FAAC, has revealed.
The report, which formed part of the submissions in the 2015 Annual Audit Report of the Federal Government’s Account by the Office of the Auditor General of the Federation, AuGF, said the state–owned oil company withheld about N644.377 billion in 2015 alone.
Out of about N1.55trn revenue from crude oil sales due for remittance to the Federation Account during the year, the report said the NNPC deducted about N892.124bn and withheld the balance.
Further details showed that cumulative amount withheld from the Federation Account by NNPC as at January 1, 2015, was about N3.234trn, with another N67.556bn withheld in February 2015. It is not clear what the corporation used the unremitted funds for.
Throughout the year, remittances totaling N13.907bn, were recorded in February and April. The AuGF requested the Group Managing Director of the NNPC to explain why the N3.878trn was not remitted to the Federation Account.
The AuGF also ordered the corporation to henceforth remit all revenues due to the Federation’s Account accordingly and evidence of such remittances tendered to his office.
Further examination of the FAAC, secretariat records revealed that total revenue inflows to the Federation Account from the various collecting agencies for the year amounted to N6.001trn.
The Central Bank of Nigeria’s, CBN’s Component Statements in the FAAC records showed that the NNPC collected about N2.44trn for the year, and Department of Petroleum Resources, DPR, N608.083bn.
Also, Federal Inland Revenue Service, FIRS, realised about N2.403trn as total revenue, while the Nigerian Customs Service collected about N546.169bn revenue.
However, the report noted that the NNPC had deducted about N865.448bn as its Joint Venture Cash Call for the year, before transferring the balance of N1.577trn into the Federation Account.
Another N51.3bn was deducted by the FIRS and DPR from their total revenue collections for the year and transferred into the PPT and Royalty Account, while balance was remitted to the Federation Account.
The NCS revenue consisting collections from import and excise duties, fees, penalty charges, common external tariff, CET levy and auction sales, was swept into the Federation Account.
However, the report frowned at NNPC’s deduction from its revenues, describing it as contrary to the provisions of Section 162(1) of the 1999 Constitution, which makes it mandatory for all revenue proceeds to be paid to the Federation Account.
“This had been a regular subject of Auditor General’s previous years’ reports without any positive response, from NNPC’s management,” the report noted. Urging NNPC management to desist from further violation of the Constitution, the AuGF said henceforth all revenues accruing to the Federation must be promptly paid to the Federation Account without any deduction.
