A major political ruckus might be unfolding between the National Assembly and the government of President Goodluck Jonathan if the Inspector-General of Police (IGP), Mohammed Abubakar, follows through with the request to arrest the Group Managing Director of Nigerian National Petroleum Corporation (NNPC), Andrew Yakubu; the Executive Secretary, Petroleum Products Pricing Regulatory Agency (PPPRA), Mr. Reginald Stanley and the Director, Department of Petroleum Resources (DPR), Osten Oluyemisiola, and bring them before the House Public Account Committee (PAC).
The three top Oil sector officials are to answer questions relating to queries raised against their various agencies by the Office of the Auditor-General of the Federation on the management of proceeds from oil sales. Announcing the decision yesterday, the Committee chairman, Solomon Adeola explained that the decision was informed by the refusal of the trio to appear before the Committee, despite several invitations to that effect. Adeola cited the 2007 Auditor-General’s report, concerning the three agencies, lamenting that such allegations were too serious to be ignored.
The audit queries which the NNPC and PPPRA were invited to respond to, noted that during the audit examination of the Federation Account at the NNPC and the PPRA, it was observed that the subsidy on petroleum products paid and deducted at source by both PPPRA and NNPC respectively exceeded the actual amount budgeted in the 2007 Appropriation Act which provided the sum of N50 billion for the payment of subsidy on petroleum products. “This matter has been brought to the attention of the Group Managing Director (NNPC) and the Executive Secretary (PPPRA) through the Accountant-General of the Federation for their comments,” Adeola said.
Adeola also averred that the audit of the accounting records revealed that NNPC deducted at source the sum of N236,941,070,020.09 as petroleum products subsidy; compared with N216,295,656,760.00 approved by PPPRA for the Corporation, giving rise to over-deduction of N20,345,413,254.09. The discrepancy, he said, has been brought to the attention of the Group Managing Director (NNPC) through the Accountant-General of the Federation for clarification, among others.
Furthermore, Adeola continued, during the audit examination of records at the Department of Petroleum Resources, it was observed that the computation of royalties paid by the oil companies was based on actual crude oil lifted by them and not calculated on actual production figures contrary to the provisions of the Memorandum of Understanding (MoU) with the relevant oil companies, which provide that royalties should be based on production volume multiplied by the prescribed royalty rates.
Finally, Adeola accused the DPR of dereliction of duty by not raising the assessments on royalties and sending the demand notices to the various oil companies for prompt settlement. Rather, the oil companies are allowed to engage in self-assessment of royalties payable by them. This compromise obviously is against the national interest. The DPR has been informed of this anomaly through the Accountant-General of the Federation, and he was requested to ensure that computation of royalties is based on the production as contained in the MoU for the benefit of the country.
The decision to order the arrest of the three officials comes in the wake of current efforts by the National Assembly to criminalize what legislators describe as the contempt of parliament. A bill, which has passed its second reading, proposes that a person summoned by the National Assembly must appear within 30 days and at the expiration of the period, the person is deemed to have committed an offence punishable by an Act of the National Assembly. Whether the IGP will honor the House request remains to be seen.
