An allegation of theft of $10billion has been laid against the Nigerian National Petroleum Company (NNPC) Limited and other stakeholders in the oil sector on the floor of the House of Representatives.
Hon Serguis Ogun who moved the motion yesterday alleged that the NNPC and its allies stole the money through fraudulent, controversial fuel subsidy claims.
Adopting the motion, the lawmakers constituted an ad-hoc committee to investigate the NNPC’s petroleum products subsidy regime between 2017 and 2021.
Hon. Ogun in his motion informed the House that as of 2002, the NNPC purchased crude oil at international market prices, which stood at 445,000 barrels per day.
He explained that the purchase was to enable the national oil firm to provide petroleum products for local consumption, adding that he was concerned that as of 2002, the installed capacity of Nigeria’s local refineries stood at 445,000 barrels per day.
Hon. Ogun said that as the capacity utilisation of the refineries began to nosedive and eventually fell entirely to zero due to the ineffectiveness and alleged corruption of critical stakeholders in the value chain.
He noted that following the decline in the production capacity of the refineries, it became more convenient for NNPC to export domestic crude oil in exchange for refined petroleum products on a trade by barter basis.
The component cost in the petroleum products subsidy value chain claim by the NNPC is highly over-bloated, the lawmaker claimed, adding that the transferred pump price per litre, used by the NNPC in relation to PPMC, was under-quoted as N123-N128 instead of N162-N165.
According to him, the fraudulent under-reporting of N37-N39 per litre, translated into more than N70 billion a month, or N840 billion naira a year.
The lawmaker who expressed worry that the consumption rate of petrol was 40 million to 45million litres per day, added that the NNPC used 65 million to 100 million litres per day.
He noted that NNPC and other critical stakeholders have used the subsidy regime to subvert the nation’s crude oil revenue to more than $10 billion, adding that records showed that as of 2021, over $7 billion of 120 million barrels was diverted.
He also said that subsidy was charged against petroleum product sales in the books of NNPC and against crude oil revenue in the books of NAPIMS, to the tune of more than N2 trillion.
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