…Calls on NNPCL to involve EFCC, ICPC

…As PETROAN urges FG to privatise Warri, Kaduna refineries, seeks N100bn grant for oil marketers

By Seun Ibiyemi and Sodiq Adelakun

The Socio-Economic Rights and Accountability Project (SERAP) has called on the Group CEO of the Nigerian National Petroleum Company Limited (NNPCL), Mr. Mele Kolo Kyari, to account for the alleged disappearance of over N825 billion and $2.5 billion meant for refinery rehabilitation and other oil-related expenditures.

This is even as Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) urged the federal government to privatise Warri and Kaduna refineries to foster competition.

This call follows disturbing findings in the 2021 Annual Report by the Auditor-General of the Federation, published on November 27, 2024, which highlights a series of unaccounted funds and unsubstantiated deductions by the state-owned oil corporation.

In the letter dated 4 January 2025 and signed by SERAP deputy director Kolawole Oluwadare, the group said, “We welcome your timely public invitation to former president Obasanjo ‘to tour the Port Harcourt and Warri refineries.

“While your invitation is clearly not ‘disrespectful,’ contrary to the claims by the former president because no one is above the law, we urge you to formally invite him, and to extend your invitation to the EFCC and ICPC for the sake of transparency and accountability.

“Your public invitation to Obasanjo is well-justified, and entirely consistent with the letter and spirit of the Nigerian Constitution 1999 [as amended] and the country’s international obligations on the obligations of the NNPCL and the roles of citizens in preventing and combating grand corruption.”

According to the letter, “The grim allegations by the Auditor-General suggest a grave violation of the public trust and the provisions of the Nigerian Constitution, national anticorruption laws, and the country’s international obligations.

“The allegations have also undermined economic development of the country, trapped the majority of Nigerians in poverty and deprived them of opportunities.

“We would be grateful if the recommended measures are taken within 7 days of the receipt and/or publication of this letter. If we have not heard from you by then, SERAP shall consider appropriate legal actions to compel the NNPCL to comply with our requests in the public interest.”

SERAP noted that according to the recently published 2021 audited report by the Auditor General of the Federation (AGF), the Nigerian National Petroleum Corporation Limited (NNPCL) failed to account for over N825 billion and USD$2.5 billion of public funds meant for ‘refinery rehabilitation’ and repairs, and other oil revenues.

“The Auditor-General fears that the money may be missing,” it said.

“The NNPCL reportedly failed to account for over N82 billion [N82,951,595,510.47] meant for ‘refinery rehabilitation and repairs. The ‘money was deducted from the sale of Crude Oil and Gas between 2020 and 2021.

“The NNPCL also reportedly failed to account for over N343 billion [N343,642,598,726.51] ‘being proceeds from domestic crude sales.’ The ‘money, meant for ‘pipelines maintenance and management costs, was unilaterally deducted from the gross domestic crude sales,”it said.

It added, “The NNPCL also reportedly failed to account for over N83 billion [N83,659,813,739.99] ‘being miscellaneous income from the NNPC joint venture operations from 2016 to 2020.’ The ‘money was withdrawn from the CBN/NNPC sinking fund account [a suspense account].

“The Auditor-General is concerned that this practice ‘has led the Federation to resort to borrowings. He wants ‘the money recovered and remitted to the treasury.

“The NNPCL also reportedly failed to account for over N204 billion [N204,853,744,047.39] ‘being unjustified deductions from the oil royalties for 2021.’ The ‘money was due to Department of Petroleum Resources (DPR) now Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

“The Auditor-General fears ‘the money may have been diverted.’ He wants the money recovered and remitted to the treasury.

“The NNPCL also reportedly failed to account for over N3.7 billion [N3,748,581,281.27] ‘being money purportedly paid to a Company as a shortfall on sales of MT cargo of PMS.’ The Auditor-General fears the money may be missing. He wants the money recovered and remitted to the treasury.

“The NNPCL also reportedly failed to account for over N28 billion [N28,654,179,867.00] ‘being outstanding bridging allowance from NNPC retail for 2021. The NNPCL failed to account for over N13.5 billion [N13,5559,658,148.91] ‘being outstanding bridging allowance claims from three major oil marketers in 2021.

“The Auditor-General is concerned that this ‘may have resulted in difficulty in funding the 2021 budget.’ He wants ‘the money recovered from both the NNPC retail and the major oil marketers and remitted to the Federation Account.’

“The NNPCL also reportedly failed to account for over N15 billion [N14,134,947,949.80 and N1,087,533,332.62] ‘being outstanding revenues from debts owed by twenty-six marketers for 2021.’ The Auditor-General wants ‘the money recovered from the oil marketers and remitted to the Federation Account.

“The NNPCL reportedly failed to account for over $29.6 million [$29,648,970.36] ‘being outstanding royalties payable to the Department of Petroleum Resources CBN account.’ The Auditor-General is concerned this ‘may have resulted in difficulty in funding the 2021 budget.

“The NNPCL failed to collect over $2 billion [$2,260,448,992.45] ‘being outstanding oil royalties from oil companies for 2021’, and failed to collect over N48 billion [N48,218,163,192.67] ‘also being outstanding oil royalties from oil companies.

“The Auditor-General fears that ‘the money may be missing.’ He is concerned that this ‘may have resulted in difficulty in funding the 2021 budget. He wants ‘the money recovered from the oil companies and remitted to the Federation Account.”

Meanwhile, Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has urged the federal government to privatise Warri and Kaduna refineries to foster competition.

In a statement over the weekend, the association said the privatisation will also improve transparency, and enhance accountability in the downstream petroleum sector.

“Privatise Nigerian-owned refineries, such as the Warri and Kaduna refineries, to reputable private companies to improve efficiency and reduce government spending,” PETROAN said.

“Foster a competitive market by encouraging new entrants and promoting a level playing field to prevent monopolies and ensure fair pricing.”

The group also urged President Bola Tinubu to approve a N100 billion grant to marketers to help with job losses caused by the removal of petrol subsidy.

“PETROAN request for a grant of N100 billion from President Bola Tinubu to help prevent the closure of 10,000 marketers’ businesses,” the association said.

“The request is in response to the threat of job losses that would result from the removal of the fuel subsidy.”

PETROAN said the recommendations will consolidate gains in the downstream sector.

According to the association, despite the challenges experienced last year, the sector is poised for continued growth and development.

“2024 was a significant year for Nigeria’s oil and gas downstream sector, marked by deregulation, infrastructure investments, and growth in the LPG market,” PETROAN said.

“The rehabilitation and commencement of production at the Port Harcourt Refinery, as well as the emergence of the Dangote Refinery, were notable highlights. While challenges persist, the sector is poised for continued growth and development in the years to come.

“As the industry navigates the energy transition and embraces new technologies, it is essential for stakeholders to remain adaptable, innovative, and committed to sustainable development.”

PETROAN advised the federal government to enhance the effectiveness of compressed natural gas (CNG) in 2025, by investing in the expansion of CNG infrastructure.

“Private sector participation should be encouraged to increase access to funding and expertise,” the association said.

“Regulatory frameworks should be reviewed to reduce operational costs and attract investment. Stakeholder engagement and awareness campaigns should be intensified to promote the adoption of CNG.”

PETROAN also suggested that the government prioritise local refineries for crude oil supply.

The association said it will boost Nigeria’s refining capacity and reduce reliance on imported petroleum products.

“This strategic move will have a positive impact on the country’s economy and energy security. By prioritising local refineries’ access to crude oil, Nigeria can unlock the full potential of its refining sector, drive economic growth, and enhance energy security,” PETROAN added