An independent oil and gas audit report of the Nigeria Extractive Industries Transparency Initiative (NEITI) for the years 2009-2011 has questioned the true ownership of the 49 percent equity investment in the Nigeria Liquefied Natural Gas (NLNG) Limited.
Chairman of the National Stakeholders Working Group (NSWG) of NEITI, Mr. Ledum Mitee said in his presentation of the report that the NNPC had received dividends and loan repayments amounting to $4.84 billion from the NLNG but was yet to remit such to appropriate holding accounts.
“Another important revelation of the report is that financial flows from NLNG including dividends and repayment of loans of which an amount of $4.84 billion was received by the NNPC. The report confirmed that these amounts have not been remitted neither to the CBN/NNPC JP Morgan account nor the Federation Account.Furthermore, the report observes that this has been a recurring issue as an amount of $3.996 billion was also reported as received but not remitted by NNPC in the previous audits,” he explained.
The report had accordingly asked questions as to who legally owns and should benefit from the 45 per cent equity stake in the NLNG.
It thus recommended amongst other issues that a thorough clarification on the seeming discrepancy be made to forestall future occurrence of such.
“On the dividends and loan repayments made by NLNG, there is a need to confirm the ownership of the 49 per cent investments in NLNG-is it for the benefit of the federation, of for the Federal Government or NNPC itself. This is an area for further enquiry.The Federal Government should also review the deduction of subsidy claims from proceeds of domestic crude sales by NNPC to align them with due process like other marketers who draw their subsidy claims from the Petroleum Support Fund (PSF),” the report recommended.
While the report indicted NNPC of non-remittance of equity proceeds from NLNG within the period under review, the shareholding structure of NLNG Ltd stated that the NNPC holds 49 per cent of the shares in NLNG Ltd.
According to the shareholding structure, Shell Gas B.V (SGBV) owns 25.6 per cent of the shares; Total owns 15 per cent, leaving Eni with 10.4 per cent of the shares in the company.
NLNG currently has six trains in operation and an overall capacity of some 22 million tonnes per annum (MTPA) of LNG and four million tonnes per annum of LPG.
Plans for building Train 7 of NLNG that will lift the total production capacity to over 30 MTPA LNG is currently at an advanced stage.