FG auditors scrutinize NNPCL’s ₦2.7tn fuel subsidy claim
The Office of the Auditor-General of the Federation has received the required documents to verify the Nigerian National Petroleum Company Limited’s N2.7 trillion fuel subsidy claim against the government.
Meanwhile, the finance ministry’s procurement department has obtained the terms of reference and scope of work for hiring an external firm to assist in the verification process.
In April 2024, the Federal Government launched a new audit of the N2.8 trillion fuel subsidy claim by the NNPCL.
An initial audit by KPMG had reduced the claims from N6 trillion to N2.7 trillion.
On May 30, 2023, shortly after President Bola Tinubu’s declaration that “subsidy is gone,” NNPCL’s Group Chief Executive Officer, Mele Kyari, informed State House correspondents that the Federal Government still owed the company N2.8 trillion spent on the petrol subsidy.
Kyari explained that the NNPC had covered the subsidy costs from its own cash flow, but the government had yet to repay the N2.8 trillion.
He said, “Since the provision of the N6tn in 2022 and N3.7tn in 2023, we have not received any payment from the Federation.
“That means they (the Federal Government) are unable to pay and we’ve continued to support this subsidy from the cash flow of the NNPC. We are waiting for them to settle up to N2.8tn of NNPC’s cash flow from the subsidy regime and we can’t continue to build this.”
In the September 2024 minutes of the Federal Allocation Accounts Committee meeting, Director of Home Finance, Ali Mohammed, assured that the forensic audit would be conducted carefully.
A section titled “Update on the Forensic Audit Covering the Period 2015 to 2022 to Authenticate NNPC/Federation Claims for N2.7tn Withheld by NNPC Limited” indicated that the required documents for the audit had been provided.
The minutes read, “The Director, Home Finance reported that the Office of the Auditor-General for the Federation was provided with the documents requested for conducting the assignment.
“He also reported that the Procurement Department of the Ministry had been given the Terms of Reference and the Scope of work to guide the process of hiring the External Firm that would support OAuGF in conducting the assignment.
“Contributing, the Chairman disclosed that he had engaged with the Auditor-General for the Federation on the matter, and there was a commitment by the OAuGF to diligently conduct the assignment with the support of the External Audit Firm as proposed. He assured that the Ministry will continue to follow up with OAuGF to ensure the successful conduct of the assignment.”
The director also suggested that the topic be excluded from discussions until new updates are provided.
“Based on that, he suggested and the meeting agreed that the matter be temporarily removed from the Matters Arising pending any future update,” he stated.
Experts monitoring the situation raised concerns about the probe after the departure of former NNPCL CFO, Ajiya Umar.
However, NNPCL spokesperson, Femi Soneye, dismissed these concerns, emphasizing that the process remains ongoing.
“I can confirm that reconciliation is currently ongoing with the relevant government agencies and auditors. Once the process is completed, the public will be informed appropriately,” Soneye said on Monday.
