NNPC denies not accounting for N7.90trn in oil revenue

Lamido Sanusi says the NNPC only remitted 24 per cent of the N10.35 trillion (about $63.5 billion) earned from crude oil sales between January 2012 and July 2013

The Nigerian National Petroleum Corporation (NNPC) has dismissed the Central Bank of Nigeria’s (CBN) allegation that it is withholding N7.90 trillion ($49.8 billion) in revenue from the sale of crude oil which should have been paid into government accounts under law.

Omar Ibrahim, a spokesman for the state oil company known as NNPC, said in a statement on Tuesday that the CBN’s assertion “is borne out of misunderstanding of the workings of the oil and gas industry and the modality for remitting crude oil sales revenue into the Federation Account”.

Lamido Sanusi, the governor of Nigeria’s apex bank, had, in a letter dated September 25 and addressed to President Goodluck Jonathan, accused the NNPC that it only remitted 24 per cent of the N10.35 trillion (about $63.5 billion) earned from crude oil sales between January 2012 and July 2013.

Sanusi claimed N7.90 trillion ($49.8 billion) was still outstanding.

“I am constrained to formally write your Excellency, documenting serious concerns of the CBN on the continued failure of the NNPC to repatriate significant proportions of the proceeds of crude oil shipments it made in gross violation of the law,” the letter said.

NNPC said it had remitted its oil sale proceeds but the missing funds should come from other government departments who are responsible for petroleum tax and royalties, while other funds will have been spent on field development.

Sanusi’s letter says the missing $49.8 billion is from the value of oil NNPC sold and makes a distinction with taxes. It says under law NNPC must submit all oil export proceeds.

“As an indicator of how bad this situation has become, please note that in 2012 alone, the Federation Account received $28.51 billion in Petroleum Profits and related taxes but only $10.31 billion from crude oil proceeds,” the letter said.

The NNPC lifted 618.55 million barrels of crude from January 2012 to July 2013.

According to a report by Bloomberg, the spot price of Nigeria’s benchmark Qua Iboe crude has exceeded $100 a barrel for most of the year, well above the government’s 2013 budget benchmark of $79. It dipped briefly to $99.50 in April, and was $112.69 a barrel as of 7.44 a.m. in London today.