Oil & Gas
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Victor Briggs, managing director, Nigerian Petroleum Development Company describes as inaccurate, media reports that the NPDC has denied receiving the sum of $6 billion from the NNPC as proceeds in its oil and gas operations
| By Anayo Ezugwu | Mar. 10, 2014 @ 01:00 GMT
THE Nigerian Petroleum Development Company, NPDC, a subsidiary of the Nigerian National Petroleum Corporation, NNPC, has distanced itself from reports in some sections of the media that it denied receiving the sum of $6 billion from its parent company being proceeds from NPDC’s oil and gas operations. Victor Briggs, managing director, NPDC, said the reports were misleading and did not reflect the contents of what was submitted to the Senate Committee on Finance, on Thursday, February 20.
“For the avoidance of doubt, the NPDC in its submission stated that the funding relationship between the NNPC and the NPDC provides for proceeds from hydrocarbon sales to be paid into an NNPC/NPDC account. The NNPC, as the parent company of NPDC, reviews and approves NPDC’s annual budgets and performance and disburses funds on periodic basis as per the approved work programme that covers both NPDC’s capital and operating expenses. This approach also provides for NNPC to critically monitor and control costs as part of its strict financial discipline and make direct payments on behalf of the NPDC for royalty and taxes while deducting costs in accordance with the provisions of the Petroleum Profits Tax, PPT as amended,” he said.
Briggs reiterated that the sum of $6 billion was remitted to the above stated NNPC/NPDC account which warehouses all of NPDC’s revenue earnings from its operations. Releases from this account are in turn disbursed into NPDC accounts for the execution of its operations. “We therefore want to restate that the NNPC funds NPDC adequately for effective conduct of its operations and meets the NPDC’s statutory responsibilities for royalties, taxes and other exactions as necessary.”
Meanwhile, the Lagos Chamber of Commerce and Industry, LCCI, has called on the federal government to scrap the kerosene subsidy regime in order to save the economy from further leakages and inherent mismanagement. Remi Bello, president, LCCI, said the chamber had watched with keen interest, the recent investigations into alleged unremitted funds into the federation account.
He said all indications showed that the continuation of the kerosene subsidy regime would have profound consequences both on the country’s economy and the integrity of fiscal operations of the government. The body, therefore, asked President Goodluck Jonathan to direct the immediate scrapping of the kerosene subsidy regime to save the economy. “The NNPC should be directed to disengage from the business of importation, distribution and retailing of kerosene. The private sector is well placed to take on this responsibility. The current model of AGO (diesel) importation and distribution should be adopted for kerosene. The statutory regulatory agencies in the oil and gas sector should exercise the desired oversight functions to ensure quality assurance of products imported or produced locally,” he said.
The chamber also called on the National Assembly to expedite action on the passage of the Petroleum Industry Bill, PIB, to provide the legal platform for the much- needed reform in the oil and gas sector of the economy. The LCCI urged President Jonathan to act without further delay on the recommendations of the various committees and audit reports on the petroleum industry. “The setting up of these committees and audit processes were driven, in the first place, by transparency concern in the oil and gas sector. Their recommendations will, therefore, provide enormous value in the pursuit for greater transparency and efficiency in the sector,” Bello said.
According to him, the reports include the Dotun Sulaiman report on governance and global best practices in the NNPC; Nigerian Extractive Industry Transparency Initiative in oil and gas industry audit reports; and KPMG audit report on the NNPC. Others are the Kalu Idika Kalu report on the refineries; Nuhu Ribadu report on the petroleum revenue; House of Representatives report on fuel subsidy; and Aig-Imoukhuede report on subsidy claims and payments. The LCCI urged Jonathan to take urgent actions to sanitise the oil and gas sector to ensure economic and political stability.
Tags: Aig-Imoukhuede Dotun Sulaiman House of Representatives Kalu Idika Kalu Lagos Chamber of Commerce and Industry National Assembly Nigerian Extractive Industry Transparency Initiative Nigerian National Petroleum Corporation Nigerian Petroleum Development Company NNPC Petroleum Industry Bill President Jonathan Remi Bello report on fuel subsidy Senate Committee on Finance Victor Briggs
