At Last, The NNPC Audit

SEVERAL reactions have trailed the report of the Pricewater house Coopers forensic audit of the Nigeria National Petroleum Corporation, NNPC, which resulted from the allegation of unremitted $49.8bn that former Governor of Central Bank of Nigeria, Mallam Sanusi Lamido Sanusi made. Mallam Sanusi at various points reviewed the figure to $10.8bn, $12bn and $20bn. The Federal Government was accused of delaying the audit. Some had concluded the report would never be made public.

The Auditor-General of the Federation has published highlights of the report. The main point was that NNPC should pay $1.48bn representing the balance of the signature bonus for the oil assets Shell divested. NNPC’s upstream subsidiary, Nigerian Petroleum Development Company, NPDC, was assigned the assets. A more appealing interest appears to remain in the billions Mallam Sanusi declared missing.

Was the signature bonus part of the missing billions of dollars? if it was, what happened to the rest of the money? The politicisation of the report would not be helpful to the cause of the accusers and the longer term interest of NNPC and the industry.

Even the National Assembly appears split on the matter. The Senate Committee on Finance conducted an independent report that absolved NNPC of the allegation of the missing money. The House of Representatives had then stood down its own motion to investigate the allegation on discovering the Senate Committee on Finance was investigating the same matter.

We support the House of Representatives demand that the full report should be published. It is part of the House’s oversight functions. Issues of probity should get adequate attention and one of the numerous duties of the House is to protect the public and its interests, the NNPC being one such interest.

However, the House’s piecemeal interest in NNPC is not sustainable. One of the best ways of establishing a long lasting watch on the affairs of NNPC is the passage of the Petroleum Industry Bill, PIB, which has been stalled in the National Assembly since 2000. The PIB would provide the legal basis for the long-awaited wholesome transformation of the NNPC which the PwC report also recommended.

Indictment of NNPC and establishment of the thresholds, which the House craves, are challenging with an extant law, the NNPC Act, which empowers the corporation to defray its operation costs and expenditures from proceeds of crude oil sales. The Senate and PwC, in their separate reports, noted that the NNPC Act formed the legal basis of expenditures the NNPC made.

Until the law is changed, neither the House of Representatives, nor anyone, can do much to transform the NNPC or getting it to stop using crude oil proceeds in financing its operations.

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