Contrary to the notion that the Nigerian National Petroleum Corporation’s (NNPC) recent withdrawals from the Nigerian Liquefied Natural Gas (NLNG) Dividend Account was politically motivated, the national oil company has said the fund will be used to better the life of Nigerians by providing requisite infrastructure.
The corporation had said the sum withdrawn was channelled to three strategic projects – the Manbilla Hydro Power project, the second Niger Bridge and the Lagos-Ibadan Expressway, despite subsidizing petroleum products.The corporation insisted that there was nothing illegitimate about the withdrawals made from the account so far.
The corporation’s Chief Financial Officer, Isiaka Abdulrazaq, in an interview, explained that the withdrawals were in the interest of the country, as they will drive economic development and empower a lot of Nigerians.
There are indications that 22 withdrawals totalling $3.2 billion had been made from the NLNG Dividend Account with the Central Bank of Nigeria (CBN) since 2015.But the alleged $1.05 billion, which was withdrawn from the account recently by the NNPC, stirred a round of controversy, even in the National Assembly.
The Chairman of the Senate Committee on Gas, Senator Bassey Albert, said the ongoing investigation of the application of $1.05billion NLNG dividend to support the importation of petroleum products into the country has nothing to do with any missing funds since no such money was missing in the first place.
Albert, who doubles as the Chairman of the Senate Committee on the Application of the NLNG Dividend, explained that the clarification became necessary due to sensational and misleading reports in some sections of the media.He said the mandate of the Committee was to determine the instrument under which NNPC relied upon to affect the said withdrawal and subsequent application of the NLNG dividend to meet pressing national concerns, noting that the Committee relies on NNPC to provide informed perspective on the issues.
The NNPC had clarified that the Senate probe was not about missing money as was being insinuated in some quarters, but rather an investigation into whether NNPC acted legally in withdrawing the sum of $1.05bn from the NLNG Dividend Account to support fuel importation.
While confirming the statutory right of the legislators to carryout oversight functions, the NNPC CFO said that relevant extant laws such as the Appropriation Act 2018 defines revenue from NNPC as net of cost, indicating that NNPC has the right to defray the cost of its operations from earnings.He also cited the NLNG Act, which he explained, provided that NNPC could defray its cost from the dividends, as one of the legal grounds relied upon for the expenditure without recourse to appropriation by the National Assembly.
Abdulrazaq cited the case instituted by some state governments in 1999 seeking the interpretation of revenue on account of their contention that all accruals from oil and gas operations amount to revenue and should be swept into the Federation Account.The ruling on that case by the Supreme Court in 2002, according to him, was in tandem with NNPC’s position that revenue is accruals net of cost.
“We have provided the legal authority on which we rely to use funds from the NLNG Dividend Account to the Senate. We believe they will reason with us. But if need be, we will seek legal opinion on it”, the CFO stated. Abdulrazak disclosed that as part of the stewardship accounting designed to make NNPC’s operations transparent to the public, the inherited six-year unaudited accounts of the corporation have been audited up to date, stressing that the account for 2017 has been fully audited, approved and forwarded to relevant authorities.
