• Monday, June 24, 2024
businessday logo

BusinessDay

Absence of IOCs stalls NNPC JV Cash Calls probe

nnpc 1

Absence of international oil companies (IOCs) stalled the investigative public hearing into the operations of the Nigerian National Petroleum Corporation (NNPC) Joint Venture Cash Calls from 2011 to 2015. This comes as the Senate has described as unacceptable the $‎6 billion cash call indebtedness.  ‎

Chairman, Senate Committee on Gas, Albert Bassey Akpan, who frowned at the absence of the IOCs after the event was declared open by Senate president, Bukola Saraki, thereafter adjourned indefinitely.

Chairman, Senate Committee on Gas, Albert Bassey Akpan
Chairman, Senate Committee on Gas, Albert Bassey Akpan

The investigation into the cash call operations by NNPC was sequel to the failure of the Corporation to meet its joint venture cash call obligations put at over $6 billion.

Although the new group managing director of NNPC, Maikanti Baru, was already seated for the investigative hearing, when the event was, however, adjourned indefinitely less than five minutes Saraki declared it open.

Apkan, who chairs the Joint Committee on Gas, Petroleum Upstream, Finance and Appropriations, warned that the committee would not take anybody below the rank of executive director to represent any of the IOCs.

“Once you are invited to appear before the committee, I don’t think there is any MD or Executive Director or any company working in this country, that is bigger than the Senate and the Federal Republic of Nigeria. So, we frown at the quality of the level of representation we have had here from the IOCs and NNPC Joint Venture partners.

“And we believe that if the GMD of NNPC who controls a much higher percentage in your Joint Venture activities can be here himself, and if all the lined executive directors could be here themselves, what becomes of the IOCs, their MDs and Executive Directors? We frown at it and we will not tolerate it whatsoever.

“Once you are invited, we do not entertain anybody below the level of an Executive Director in any company that will appear before the Senate. And that is the tradition and we want to adhere strictly to it,” a visibly angry Akpan stated.

It came on the heels of the debate and adoption of a motion by the Senate on April 13, 2106 on the urgent need for effective implementation of the Joint Venture Cash Calls obligations by NNPC in accordance with various Appropriation Acts of the National Assembly.

‎The public hearing was later suspended indefinitely until the committee was able to get the appropriate leaders of the IOCs to attend the investigative meeting.

‎The lawmaker noted that the effective implementation of the joint venture cash calls by both NNPC and its operators determine the level of investment activities in the oil and gas sector.

Declaring the public hearing open earlier, Saraki noted that the Senate was disturbed with the frequent distortions that keeps coming out of the oil and gas industry.

“‎At a period of disturbing and increased pipeline vandalism in the Niger Delta region, the current cash call indebtedness standing at over $6 billion is a big problem staring at our economic health.

“‎The 2013 Nigeria Extractive Industry Transparency Initiative (NEITI) report submitted to the Senate on June 15, 2016, clearly shows that the huge sums of money that were not remitted to the federation account between 2005 and 2013 by the NNPC amounts to about $12.9 billion. That simply doubles the debt we have all sat here to investigate.”‎

He continued:‎ “Despite the fact that NNPC has a larger amount of the proceeds from the joint venture, it worries the Parliament to know that it has consistently been defaulting in payment of its own counterpart funding of projects.

“‎There is no doubt also that there is still lack of clarity in the current financial regimes, royalties and taxes in the oil and gas industry.”‎

‎The Senate President noted that “The NNPC is expected to lead in public disclosures of financial dealings earned and its expended revenues. This is vivid with the confusing and conflicting figures reeled out during reconciliation process among the agencies responsible for the receipts of funds meant for the federation accounts.”‎‎

He lamented further that “‎While most oil producing companies that started exploration at about the same period as we did like Norway, Brazil,  Saudi Arabia, Kuwait, Qatar, Malaysia and the UAE have efficient and reliable infrastructure with sustainable industrial growth. Nigeria’s case reflects a paradox of these ideals”‎