The Nigerian Governors’ Forum (NGF) has raised concerns about the inability of the Nigerian National Petroleum Company (NNPC) Limited to meet its obligations to the federation account in recent months.
Kayode Fayemi, chairman of the forum and governor of Ekiti State, said this at the Nigerian International Energy Summit (NIES 2022) held in Abuja on Thursday.
“NNPC declares profits yet it cannot meet its obligations. My simple knowledge of economics teaches me that it is only after you’ve met all your obligations, that you then talk about making profits. So if your obligation to the Federation account has not been met, how can you then talk about profit making,” Fayemi asked.
“We’ve just had the federation allocation accounts committee meeting a couple of days ago, and the NNPC contributed zero to the federation account this month and this is not the first month that the NNPC is contributing zero. Over the last couple of months we’ve been having these challenges of course, we know why.”
NNPC Limited in the 2021 fiscal year remitted a total of N542. 296 billion, which is a decline from N2.511 trillion projected for the year.
The monthly breakdown of the company’s remittance shows that of the N209.3 billion monthly projection, the sum of N90.86 billion was remitted in January, N64.161 billion was remitted in February, N41.184 billion in March.
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Nothing was remitted in April, but N38.60 billion, N47.162 billion, N67.28 billion, N80 billion and N67.53 billion were remitted in the months of May through September respectively.
Also, a total of N14.85 billion in October, N10.53 billion in November and N20.09 billion was remitted in December respectively.
Fayemi however lamented that transparency is central to the challenges the Nigerian oil and gas sector face, adding that Nigerians appear to be suffering more even though the oil prices in the international market is going up.
According to him, there are gaps in growing the industry and growing the sector, particularly in ensuring a sustainable institution that would not only respond to the yearnings of the industry but also the general concerns of the Nigerian public.
“For us as states that are beneficiaries of the goose that lays the golden egg, the oil and gas industry, we also are very desirous that this industry is sustained over the long term. We see areas of concerns, particularly in terms of revitalising the industry around transparency and accountability and governance of the sector,” Fayemi added.
“In every transition, the old is done but the new is not yet born you’re caught in the middle and there is a significant amount of confusion that happens in that transition period. I guess that’s what we’re experiencing now but the faster we can complete that process of transition, I think the better it is for us.”
He pointed out that though oil prices are going up, the country is hardly making anything of it.
“Even though oil prices in the international market are going up, maybe $110 today or more, the more it goes up it would appear that the more we suffer locally now,” he said.
“For us, as states ultimately what we’re looking at is a situation where at some point even the industry itself could operate the way your LNG operates currently so that at the end of the day there’s greater transparency, there’s greater accountability and the governance framework is really built on the efficiency of the industry.”
