Uche Usim, Abuja
A pilot study on the petroleum industry conducted by the Nigerian Extractive Industries Transparency Initiative (NEITI), has revealed the Nigerian National Petroleum Corporation (NNPC) shortchanged the Federal Government by failing to remit N77.92 billion earned from crude sales into the federation account in 2017.
The report, released by the Executive Secretary of NEITI, Mr Waziri Adio, also revealed that the total revenue from the sale of federation share of oil and gas for 2017 was $14.5 billion—$13.18 billion or 90.8 per cent from crude oil and $1.32 billion or 9.1 per centfrom gas.
The report added that the NNPC deducted N297 billion from earnings from the domestic crude allocation as costs and losses, broken down as follows; N141.6 billion for under-recovery on petroleum products (subsidy); N25 billion for crude and product losses; N130.4 billion for pipeline repairs and maintenance.
The said said the NNPC acknowledges the under-remittance and states that there is an ongoing reconciliation to net off the N77.92 billion from “the established Federation indebtedness to the Corporation of N797billion arising arising from KPMG Forensic audit of the Corporation at the instance of the Federation.”
The total crude oil production for 2017 was 692 million barrels. Out of this volume, the share that went to the federation was 240.9 million barrels representing 35per cent of the total crude oil production for the year 2017.
“A trend analysis for the year under review shows that the 2017 federation share was 4 per cent higher than the 231.6 million barrels in the same category for 2016 but was 19 per cent lower than the 297.8 million barrels for 2015. This shows that while there was a slight improvement on the figure for 2016 (a year characterized by vandalism and sabotage of oil facilities), crude production for 2017 was about a fifth less than the 2015 level”, NEITI noted.