FG, NNPCL Clash Over Unresolved NEITI Audit Queries

The Federal Ministry of Finance and NNPCL have traded blame over unresolved queries in Nigeria’s 2021–2023 oil and gas audit.

The dispute emerged when Permanent Secretary of the Ministry of Finance, Raymond Omachi, appeared before the Senate Committee on Public Accounts, chaired by Senator Ibrahim Dankwambo.

Omachi told lawmakers that the ministry could not provide some documents needed to answer the NEITI audit queries because agencies involved in the transactions, particularly NNPCL, had not supplied the required records.

One major issue concerns a $3 billion pre-export financing loan secured in 2012 to fund subsidy payments. NEITI said it remained unclear how the loan was recovered from monthly Federation revenue under the Pre-Export Financing and Project Eagle agreements.

Another query involves $722.6 million paid by Nigeria LNG Limited to the former NNPC in 2021 as dividends and interest earned for the Federation. According to NEITI, the money was neither remitted to the Federation nor properly accounted for.

The committee also examined the finding that none of Nigeria’s refineries operated in 2021 despite about N200 billion reportedly being spent on them. It further considered $221.283 million in overhead costs incurred by the National Petroleum Investment Management Services in the same year.

Omachi said the Finance Ministry was not directly involved in every transaction under review and therefore depended on other agencies for supporting records.

“We don’t have direct involvement in all the issues raised and required provision of financial records from the affected agencies, particularly NNPCL, NUPRC, etc., is not there.”

The ministry has engaged Arthur Andersen LLP to conduct a forensic audit and reconcile the records. However, Dankwambo questioned the repeated extensions to the exercise, which has grown from six months to one year.

The committee directed the Finance Ministry to arrange a joint meeting with NNPCL, NUPRC and other relevant agencies to resolve the outstanding matters.

Dankwambo said the issues required urgent action because they were being monitored internationally.

“I will like you to review the internal report and arrange a meeting involving the Ministry of Finance, the NUPRC, NNPC and any other agency whose participation is necessary to resolve the issues we have raised,” he said.

“As you are aware, these issues are being followed by the international community. They are not matters confined to Nigeria; they are in the public domain and are being monitored by people across the world.

“Therefore, if there are records or issues that need to be clarified and properly put in order, we should do so in the interest of our country. All of us have no other country except Nigeria.”

The committee will continue reviewing the NEITI audit queries after the agencies submit the requested records and explanations.

What steps should government agencies take to prevent unresolved audit queries from recurring?