Reps target $20bn unremitted oil revenue from audit

The House of Representatives on Friday vowed to help the federal government to recover $20 billion unremitted revenues from the oil and gas sector. They also vow to legislate for energy security, professionalism in the petroleum sector, economic transformation, accountability, institutional reforms and revenue recovery and generation.

This is even as it promised to carry out a comprehensive audit of the Premium Motor Spirit (PMS) subsidy regime, adding that the early remittance of Federal revenues and recovery of unremitted revenues is part of what the Committee would focus on in the coming days.

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Ikeagwuonu Ugochinyere, Committee on Petroleum Resources (Downstream) who stated this at the inaugural meeting of the Committee in Abuja said the implementation of the Petroleum Industry Act (PIA) which has become a major concern to key stakeholders would be thoroughly reviewed.

Ugochinyere informed that the HOS would also probe the benefiaries of the payment, rendering accounts on all loan transactions, the pre-export financing arrangement and other loan arrangements, in exchange for crude would be extensively reviewed and investigated.

According to the Lawmaker, Direct Sales, Direct Purchase, using the crude to bring in the PMS and other value chain associated with them will also be reviewed.

Another issue Ugochinyere mentioned is that the Lawmakers have been receiving messages that most of the modular refineries, even the general refineries like Dangote and so on may not be able to get the required domestic supply they would need.

He promised to use their legislative powers to help solve the nation’s energy problem, create healthy competition in the industry as envisaged by the PIA, create job opportunities and stabilise the Forex market, stressing that if the downstream sector is functioning very effectively, there would be no need for Nigeria to be running looking for Forex to PMS, which is now creating instability in the Forex market.

The Lawmaker affirmed that, this caused most of the pre-financing and loan for PMS and crude swap and that the Committee is going to look into it to ensure that there is adequate domestic crude supply to the domestic refineries to ensure that the country achieve energy security.

“We would probe the benefiaries of the payment, rendering accounts on all loan transactions, the pre-export financing arrangement and other loan arrangements. Also other loan arrangements in exchange for crude would be extensively reviewed and investigated. The Direct Sales, Direct Purchase, using the crude to bring in the PMS and other value chain associated with them will also be reviewed.

“It is also very important that we would make is known to Nigerians that we feel the pains that Nigerians are going through due to the removal of the subsidy regime. That regime had to go because it was corrupted and that is why the downstream committee of the House on Petroleum resources would do a comprehensive audit of the PMS subsidy regime.

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“The implementation of the PIA which has become a major concern to key stakeholders would be reviewed by this committee. What was done before the PIA? What they are doing after the PIA? The assets that used to be national assets before the coming into effect of the PIA. Where are they? Who is with them? All these the committee would look into to ensure that the intention of the PIA is achieved. One of that intention is to ensure that there is energy security and competition in the downstream sector.

“But if you come now you will see that NNPCL is the main importer of PMS. That is not the main intention of the PIA. The PIA had envisaged a situation where numerous downstream operators would have been involved in the importation of PMS. That we would also look into. We intend to use our legislative powers to help solve our nation’s energy problem, create healthy competition in the industry as envisaged by the PIA, create job opportunities and stabilise the Forex market because if today the downstream sector is functioning very effectively there would be no need for us to be running looking for Forex to PMS, which is now creating instability in our Forex market.

“Another issue of concern of recent is that we have started getting reports that most of the modular refineries are ready for operation and there are challenges of domestic crude supply. The PIA made provisions for domestic crude supply to those modular and all our local refineries, it has a constitutional provision. It is a law. Today we are receiving messages that most of these modular refineries, even the general refineries like Dangote and so on may not be able to get the required domestic supply they would need.

“This, they said, is caused by most of these pre-financing and loan for PMS and crude swap and so on and so forth. This committee is going to look into it to ensure that there is adequate domestic crude supply to the domestic refineries to ensure that we achieve energy security.

“Let me also inform that as you are already aware, the House has received in plenary the NEITI report that have far reaching recommendations both in the downstream, upstream and midstream sector, especially the issue of over $8.5 billion unremitted royalties and other oil revenues and the discrepancies that have to do with the quantity of PMS imported by the NNPCL and what is in the record of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).

“The House has set up a joint committee that involves the committees in downstream, upstream and midstream to look into the issue. In the coming weeks we would start looking into all these issues to resolve them. Posterity would always judge our actions and inactions. So we must do the needful today.”

“Let me also urge the various stake holders in the petroleum sector to cooperate with our Committee in the discharge of our functions and be open to positive changes where necessary. We are not going to victimize anybody, we won’t witch-haunt any one, but we will certainly do our work with a deep sense of service to the nation.

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“We thank the leadership of the 10° House of Representatives (the People’s Parliament) ably led by Rt. Hon. Tajudeen Abass, Ph.D and Rt. Hon. Benjamin Kalu for giving us the opportunity to contribute our quota to national development, by appointing us to serve in this all important Committee,” he noted.

He expressed confidence in the caliber of membership of the Committee to deliver on its mandate, assuring the Committee would be working closely with other Committees in the Upstream, Mainstream, Gas, Petroleum training fund and other petroleum related Committee to also help achieve the set objectives.