Governor of Central Bank of Nigeria (CBN), Malam Sanusi Lamido Sanusi must resign his position, the New Nigeria Initiative (NNI) said on Monday.
According to the group, Sanusi’s decision to throw caution to the wind on the money allegedly missing in the sale of crude oil by the Nigerian National Petroleum Corporation (NNPC) while reconciliation of the books is still ongoing. It berated the governor for claiming such figures as $49.8bn, $12bn and $20bn at different times as sum unremitted to the Federation Account by NNPC.
“Since the outgoing Central Bank Governor (CBN), Malam Sanusi Lamido Sanusi has decided to wear the garb as the emperor of financial institutions in Nigeria, we shall let him know that we do not recognise the illegal turbaning, which he conducted all by himself”, the group said in a statement signed by Dr Maccido Abdullahi.
“We hereby serve notice that if, within 10 days from today, he does not resign as CBN governor, he should be prepared to be disgraced out of office for improper conducts, which we are ready to expose to Nigerians and the world at large. This is not a threat but a promise. Those who live in glass houses should not throw stones”.
NNI criticised aspects of the memorandum submitted by the CBN governor to the Senate Committee on Finance, observing, for instance, that his claim on the renegotiation of fiscal terms of the Production Sharing Contracts (PSCs) without recourse to Petroleum Industry Bill (PIB) could be false.
“This is because any renegotiation of the fiscal terms of the PSCs would require amendment to the Deep Offshore and Inland Basin Production Sharing Contracts Act of 1993 as amended. This Act specifies the tax and royalty rates to be paid by the PSC contractors. Since it is an Act, it can only be amended by another Act of the National Assembly,” it said.
“Sanusi’s allegation that NNPC took away blocks from the Federation and gave them to itself (using NPDC as a Special Purpose Vehicle, SPV) and then transferred the operation of the blocks to agents with limited experience in operating oil blocks is not correct.
“We wish to debunk it to wit: the blocks were properly assigned with the consent of the Government (see the recitals of the Agreements for the date of consent); NPDC is an upstream subsidiary company of NNPC; and NNPC is empowered by its Act to review its affairs for the purpose of determining how the management of its activities or any of its subsidiaries can most efficiently be organized.
“The allegation that NPDC gave its business partners tax relief and waivers in the Strategic Alliance Agreements (SAAs) is also not true. The SAAs are financing agreements and more or less service agreements. The Clause, referred to in the SAA, which is on Taxes, Royalties, Rates and Dues, is a standard provision in all the Service Agreements that Nigeria has entered into with Service Contractors ( See Article 17 of NNPC and AGIP Energy and Natural Resources Ltd Service Agreement and also Article 18 of NPDC and AGIP Energy and Natural Resources Ltd Service Agreement ).
“The tax relief and waivers are as provided in our Fiscal laws. See Section 10 of the Petroleum Profit Tax (PPT) Act. Besides, the SAA contractors are subject to Company Income tax regime. It is only NPDC that is required to pay PPT.
“There is no doubt that the CBN governor is following up on his earlier release that was discredited for lack of understanding of the Nigerian oil industry by many experts, leading to an agreement by him that he was misinformed. Could this be the case again? We believe it is.
“It is clear that, in Sanusi’s defence, he is undertaking the job of a watchdog on the revenues of the country. To be sure, he is not the appointed auditor in such matters. But why has he decided, in recent times, to rush to put sensitive financial information in the public domains without clear and hard facts? Recall his handling of the toxic banking crisis: jobs were lost for what many other bankers agree could have been better handled. Is that a scenario that will play out with these new supposed revelations?”
The group praised government for being ahead of Sanusi on the matter, especially as proven by the Petroleum Industry Bill (PIB) that will take care of many issues Sanusi raised in his submission.
“The PIB will ensure adjustments for the fiscals as contained in existing contracts and reduce the burden of cash handover by the Federal Government. The cash transfers are a key reason for transactions of allowing operators with the financial ability to operate on behalf of NNPC productive assets. The PIB will also address procedural circles of budgeting that can improve returns on oil sector investments.
“The government, earlier on, had tried to implement a subsidy removal, an action that was resisted by Nigerians. The subsidy removal would have eliminated inefficiencies as currently experienced in product importation. PPPRA has done a commendable job on this and more is expected.
“Nigerian Extractive Industry Transparency Initiative (NEITI) is supported by the government to continue to strengthen its audit oversight on the extractive industry. The President, Dr Goodluck Jonathan, last year, made pledges to improve government support when a delegation from the international secretariat was hosted by him. The last audit report is currently under consideration and issues noted will be acted upon during a remediation exercise. The president, we understand, had also set up a high inter- ministerial committee to ensure that recommendations from the report are implemented.
“We have also noted that the CBN governor stated that reconciliation needed to be continued to ensure that revenue was captured. This is in the interest of the nation and it will be ongoing, we agree. But rushing issues based on assumptions only creates disharmony in a system and might be interpreted as having a deeper concern than that of the national interest.
“Caution is needed and it should be applied. But since the Emperor of financial institutions has thrown caution to the wind by attempting fruitlessly to undermine the integrity of a government of which he is a member, the only option open to him is to resign forthwith. And we have given him 10 days from the day or date of this publication to do so”.
