• News - North Central - FCT
  • Updated: May 21, 2024

Reps quiz NNPCL over N10.8trn revenue projection for 2024

Reps quiz NNPCL over N10.8trn revenue projection for 2024

The House of Representatives questioned the management of Nigerian National Petroleum Corporation Limited, NNPCL, on Tuesday about their projected revenue of N10.8 trillion for the 2024 fiscal year.

The Chairman of the House Committee on Finance, Hon. Abiodun James Faleke, led the hearing and requested details of all joint venture contracts with International Oil Companies (IOCs).

After reviewing the submitted documents, lawmakers expressed concerns about meeting the crude oil production and revenue forecasts for the year.

The documents showed monthly crude oil production targets ranging from 1.644mbpd in January to 1.946mbpd in December 2024.

Lawmakers also questioned the projected N368 billion profit sharing from production-sharing contracts, which seemed inconsistent with the increasing crude oil production targets.

Additionally, they queried the static N81.2 billion monthly dividends despite the projected production increase.

The hearing aimed to scrutinize the revenue generated by key MDAs and ensure transparency in the oil sector.

Members of the Committee also demanded for update on the Frontier Basin projects embarked on by the Corporation as stipulated in the Petroleum Industry Act (PUA) across the country, including Bauchi, and Sokoto-Bida, among others.

The lawmakers also inquired into the revenue projected from gas supply which they argued was low

Responding to various questions from the lawmakers, NNPCL Chief Financial Officer (CFO), Mr. Umar Ajiya disclosed that from the N10.8 trillion revenue projection submitted in the 2024 Appropriation plan, the company has so far remitted the sum of N2.5 trillion into government's coffers as at the end of the first quarter of 2024.

The breakdown of the revenue paid include N2.50 trillion from upstream, N22.53 billion from gas and power, N24.69 billion from Downstream and N1.10 billion from other sources which was not disclosed by the Chief Operating Officer.

He however assured the Committee that the company may surpass the N10.8 trillion revenue projection.

While responding to questions bordering on the engagement of a private company - Tantita for pipeline security, Ajiya discloser that the Corporation was able to attain the current 1.5mbpd as against the 1.0mbpd after the engagement of Tantita Security company.

He also explained that the decision on naming and shaming those involved in the economic sabotage is solely the responsibility of the Court, as well as security agencies, adding that while the Nigerian Navy has the capacity to track every vessel on Nigerian waterways, only Tantita has made arrest of those involved in oil thefts.

On the fluctuation of the crude oil production, he explained that the company has a couple of investments being carried out including the 40,000bpd crude oil production.

He also confirmed that the IOC partners are divesting not only because of insecurity but also due to fiscal incentives in other jurisdictions.

Ajiya also informed the Committee that the Electricity Generation Companies (GENCOs) owed the Company the sum of N500 billion before President Bola Tinubu's administration.

Chairman of the Fiscal Responsibility Commission (FRC),  Victor Mururako, NNPCL has failed to provide relevant financial documents for scrutiny in breach of extant financial regulations.

While noting that the company had no record of remittances by the NNPCL as expected by law, the FRC helmsman who was represented by Mrs. Victoria Adizou-Angakuru, said: “Ours is just a plea as regards their remittance to the purse of the government, which is the CRF.

“The Commission has observed that NNPCL has not really been having a good rapport with FRC. They have been meeting other agencies like RMFAC and OAGF to resolve disputes regarding their operating surplus remittances but they have never come to FRC for reconciliation.

“Our table shows that from 2007 to 2018 we have computed the liabilities against NNPCL but we are not saying these liabilities are still existing but we don't have any evidence as against any remittance they could have made

“We want to plead that they should also meet with FRC the custodians of the Act in which these other agencies are using to determine their liability.”

While ruling, Hon. Faleke mandated NNPCL to reconcile its account with the office of Accountant General of the Federation as well as the Fiscal Responsibility Commission (FRC) and report back on Wednesday.

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