Oil tanks
By Chineme Okafor
In a move to forestall contentious afterclaims that could repudiate its evaluation and audit report of processes and payments of petroleum proceeds accruing to the Federal Government within 2009 to 2011, the Nigeria Extractive Industries Transparency Initiative (NEITI) has invited the Nigerian National Petroleum Corporation (NNPC) and some oil companies.
Others oil firms invited include Shell Petroleum Development Company (SPDC), Chevron Nigeria Limited, and Nigeria Agip Oil Company (NAOC) Ltd among others to validate and reconcile payments they made to the government.
The invitation is also extended to all companies and government agencies involved in payment and receipt of revenue from Nigeria’s petroleum sector is expected to validate all payments within the period under review to avoid condemnation of its audit report when published.
It is also expected that the exercise will afford all parties involved an opportunity to reconcile such payments with data collected by NEITI’s independent auditors, as well as review presentations on system documentation by companies and relevant government agencies in line with the audit requirement.
Others companies to appear before it in Lagos are NNPC, SPDC, NAOC, Chevron, Shell Nigeria Exploration and Production Company (SNEPCO), Nigeria Agip Exploration (NAE), Agip Energy Natural Resources (AENR), Mobil Producing Nigeria Unlimited, Esso Exploration and Production Nigeria Limited, Nigerian Petroleum Development Company (NPDC) and CONOCO Phillips.
Also among the list are the Office of the Accountant General of the Federation, Power Holding Company of Nigeria (PHCN), Nigeria Gas Company (NGC), Nigeria Liquefied Natural Gas (NLNG), Federal Inland Revenue Services (FIRS), Department of Petroleum Resources (DPR), Central Bank of Nigeria (CBN), Nigeria Maritime Administration and Safety Agency (NIMASA) and the Nigeria Petroleum Investment Management Services (NAPIMS).
According to an advertorial widely published by NEITI in mass media, the invited companies are expected to tender documents such as system documentation on production and financial flows including payments and receipts of such flows by relevant government agencies on behalf of the federation as well as evidence of streams of payments made by companies.
NEITI’s audit of Nigeria’s oil and gas sector has come with disclosure of anomalies in revenue remittance by oil and gas companies to the federation account, with NNPC majorly accused in the audit reports of falling short in its remittance of oil proceeds to the government.
For instance, the NNPC is still yet to remit about N588 billion to the Federation Account as at the last audit conducted by NEITI. Executive Secretary of the NEITI, Mrs. Zainab Ahmed had stated in a presentation at the National Assembly that apart from the N450 billion figure the NNPC agreed to pay on installment basis to the Federation Account, the corporation still owes the federation N588 billion as discovered in NEITI’s 2008 audit report on the sector.
Accordingly, NEITI had awarded two reputable indigenous and independent audit outfits the contract to conduct the 2009-2011 oil and gas industry audit and the 2009-2011 solid minerals audit. The firms, Sada Idris & Co. will undertake the oil and gas industry audit for a contract sum of N226.6 million, while Haruna Yahaya & Co. is to conduct the first Nigeria’s solid minerals sector audit at the cost of N137 million, bringing the combined total contract sum to N363.6 million.
The two audit reports are expected to be completed within the year after which NEITI will commission them for dissemination and reporting.