Missing oil fund: Will a Senate probe end the macabre dance?

As the Senate Committee on Finance commences private sitting to analyse submissions at the public hearing  on the missing oil money,  EZREL TABIOWO  recalls the claims and  counter claims at the hearing and wants the lawmakers to be distinguished in their handling of the seeming mess

The recent investigation by the Senate Committee on Finance into the alleged unremitted oil revenue by the Nigerian National Petroleum Corporation(NNPC), and kerosene subsidy payments made without recourse to appropriation, has placed the upper chamber in the spotlight as Nigerians anticipate its final report to be made public.

The accompanying drama and shocking details of how  the nation’s finances are being run, certainly leave a sour taste in the mouth.  Following the alarm raised over alleged missing fund  by the suspended governor, Central Bank of Nigeria(CBN), Sanusi Lamido Sanusi,  the Senate swung into action to unravel the mystery behind it.  To this end, it mandated  Ahmed  Markafi- led committee to probe deep with a view to coming with the facts and figures of this sensitive  allegation.  And as a matter of responsibility, the lawmakers unanimously aligned themselves with the position of the finance minister, Dr. Ngozi Okonjo-Iweala, for  an independent forensic audit of the submissions made by the NNPC. This, it believed would settle once and for all myths surrounding the alleged  missing $10 billion oil money.

The forensic experts,  according to the minister, will examine the books of the NNPC, its subsidiary, Nigerian Petroleum Development Corporation(NDPC) as well as other government agencies operating in the oil and gas sector.
Okonjo-Iweala said, “It should be emphasised that the issue of unremitted funds by the NNPC is not new; it has been an ongoing issue at every Federation Accounts Allocation Committee meeting chaired by the ministry of finance, as evidenced by reports from the monthly meetings.

“As of December 2013, the cumulative un-reconciled figure of shortfalls from NNPC payments stood at N1.792tn, or about $11bnillion.  On the original $10.8billion, which was the shortfall we had as of July 2013, another reconciliation meeting was held at which NNPC presented data of how it utilised the balance of $10.8billion, namely: amount withheld for subsidy, $8.766billion; holding cost of strategic reserves, $0.4599bn; crude oil and product losses, $0.761billion; and pipeline management cost, $0.905billion, for a total of $10.89billion.”
“The data presented were all certified by the PPPRA as being accepted. We asked to see the backup documentation to enable verification.

“Our judgment is that a proper examination of these documents requires technical expertise beyond the capacity of the reconciliation team, and, therefore, we believe we should have an independent forensic audit managed independently of these submissions,” the minister further added.

The  embattled CBN governor,  had,  while appearing before the committee insisted  that the NNPC was yet to account for $20billion oil proceeds and that the subsidy the corporation was removing on kerosene was illegal, null and void. But the Minister of Petroleum Resources, Mrs. Deizani Alison-Madueke,  countered Sanusi,  saying,  kerosene subsidy was legal  and maintained that there was no official gazette to stop its removal.

Also adding his voice, NNPC  Group Managing Director,  Andrew Yakubu, insisted  no money was missing and that the corporation had not received any subsidy payment for petroleum products supplied to the domestic market since 2012.
He said the N888.101bn and N971.138biillion appropriated for that purpose in 2012 and 2013 were grossly inadequate to meet the payment obligations to both the NNPC and other marketers.

“This development led to the accumulation of $8.76bn as unpaid subsidy due to the NNPC for petroleum products supplied during the period under review. This amount comprised $5.25bn for PMS (petrol) and $3.51bn for DPK (kerosene),” he said.
Amidst all this, the committee chairman, Senator Makarfi, said the body would study the documents and submissions by the NNPC, noting that “our own forensic examination of the document will make us take a decision as to whether the documents support the expenses incurred.”

He said, “We have also received certification for kerosene subsidy but the key issue is the appropriation to it and we have all agreed here that no appropriation has been made for it.
“The implication of spending money that is not appropriated is well known to everybody and the whole world is hearing this. I don’t want us to joke or play with this. It is the most central issue.
“All agencies that have spoken have confirmed to the whole world that this money was not appropriated and I want people to absorb the import of this confirmation.

“We will deliberate on how to deal with the past, how we will deal with the future is critically important and this is the best time to deal with the issue to avoid further contravention.”
Taking the drama further, the Senate last week   asked the NNPC  to account for some  $2.4 billion oil revenue. This followed the corporation’s failure to  keep its book tidy  during last Thursday’s investigative hearing into the alleged missing $20 billion oil fund.
The lawmakers had, at the hearing asked the NNPC to withdraw its initial submission that only $2 billion only was missing, as certain discrepancies which were identified indicated that the actual amount yet to be accounted for was $2.4 billion.

And quickly, the corporation owned up but explained  that the $2.4 billion was paid as third party financing out of the $67billion realized from crude oil sales between January 2012 and July 2013. Following this untidy presentation by the NNPC, a smart Makarfi  asked the corporation to prepare a fresh memo detailing how the sum was spent, a position the  NNPC GMD acknowledged.

This inconsistency in the NNPC accounts must have informed the assurance by Dr. Sarah Alade, the CBN acting governor, who told the gathering  the law would be complied with on what fraction of crude oil revenue should be remitted to the federation account. Makarfi had demanded to know from the CBN  the percentage of the revenue from crude oil sales  to be remitted into the federation account.

And from the Auditor-General of the Federation, Mr. Samuel Ukura, came  what some might term a glaring  anomaly in the Nigerian Constitution, as he disclosed that his office was not, by virtue of Section 85(2) ,  empowered to  carry out a forensic audit of the NNPC  nor even  audit any other agency of government. He however admitted that all it could was a routine checks.
Nonetheless, the committee  asked the Auditor-General to explain the link between his routine checks in the NNPC  and the committee’s investigation. They specifically requested Ukura to furnish them with information on whether the periodic check his office was doing in the NNPC had to do with the investigation it is currently carrying out. And this, members insisted must be done in writing.

As the committee plans to commence  private sittings to analyze all submissions, it is pertinent to know that due process must not be compromised. As true representatives of the people, the burden is now on the senators to do themselves as well as the nation proud.  Although confusion in the realm of figures reigned supreme while the hearing lasted, the fact remains that there are obvious loopholes in the way the the nation’s oil money is being managed. It’s about time something was done to correct this. This probe must not go way the way of some others which ended a mere macabre dance.