The Nigerian National
Petroleum Corporation (NNPC) has reacted to the Ribadu Report with a robust
rejoinder. The Report of the Petroleum Revenue Special Task Force led by Nuhu
Ribadu was presented to the President on 2nd November 2012.
The NNPC rejoinder
addresses a number of areas in which the Corporation came in for criticism
including:
Direct deduction of
subsidy payments from amount due to the Federation Account: NNPC said it was
within its rights to claim the credits due to it for the subsidy payments
pursuant to the requisite certification by PPRA and that it was in fact due
N752.77 billion and not N132.7 billion in outstanding subsidy payments.
Discrepancy in the
pricing of domestic crude: NNPC said there are established guidelines for the
selection of companies for the lifting of Nigerian crude oil and that the
guidelines are strictly adhered to and regularly publicized.
Exchange rates used to
remit payments to the Federation Account: NNPC said it always uses the
applicable exchange rate advised by CBN in computing funds to be remitted to
the Federation Account.
Utilisation of
domestic crude allocation: NNPC pays for all domestic crude allocation at
prevailing international market prices and in line with the general terms and
conditions for sales and purchase of Nigerian crude oil grades.
NNPC crude oil sales
and sales to traders without formal contracts: NNPC said it maintains a mixed
bag of trading companies to facilitate wider market circulation and penetrate
into new (captive-niche) markets. These include international traders,
indigenous traders, international refining companies, NNPC subsidiaries and
international trading joint ventures. All terms and conditions of payment, they
said, are based on the same general terms and conditions for the sale of
Nigerian crude oil.
Price of feedstock gas
to NLNG: NNPC said the Task Force did not obtain the gas supply and sales
agreements or it would have been able to understand the basis for the pricing
of the feedstock gas to NLNG. The Corporation said: “The Taskforce wrongly
compared the price of feedstock to the price of re-gassified product. It also
erroneously assumed that there is a single international price for either
feedstock or re-gasified product.” NLNG has also denied the conclusions of the
Task Force.
NNPC’s role in
petroleum revenues: NNPC said the allegation that NNPC increasingly relied on
the Federal Government for lines of credit, which includes formal and informal
loans and deduction of oil revenue due to the Federation Account was wrong. The
Corporation said that NNPC, in line with the policy of the Federal Government
to encourage commerciality of NNPC’s operations, has not relied on the Federal
Government for loans and credit lines but has instead sought innovative means
of financing its operations.
There has been no
official response so far from the Task Force to the NNPC rejoinder.
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