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Business News of Thursday, 2 December 2021

Source: nairametrics.com

House of Reps to set up investigative committee on NNPC accounts

House of Representatives House of Representatives

The House of Representatives has announced it will set up an adhoc committee to investigate accounts belonging to the Nigerian National Petroleum Corporation (NNPC) and its subsidiaries

The House adopted the resolution after a motion by Rep. Ibrahim Isiaka (APC-Ogun) at plenary on Wednesday, December 1, 2021, in Abuja.

The committee is to investigate the consolidated inventory, assets, interest and liabilities, according to the News Agency of Nigeria.

Honourable Isiaka said that the NNPC was established on April 1, 1977, following a merger of the Nigerian National Oil Corporation and the Ministry of Petroleum and Energy Resources, citing that its duty was to manage joint ventures between the FG and IOCs, including assets on land, swamp, continental shelf and deep waters.

“Aware that in 1988, the NNPC was commercialized into 12 strategic business units covering the entire spectrum of oil industry operations including exploration and production, gas development, refining, distribution, petrochemicals engineering and commercial investments among others.

“In line with Section 53 (1) of the Petroleum Industry Act (PIA), the Nigerian National Petroleum Company Limited was registered and incorporated by the Corporate Affairs Commission on September 22nd, 2021 as a Limited Liability Company with an initial capital of N200 billion, which was regarded as the highest share capital holding in Nigeria.

“Cognizant of Section 53 (3) of the PIA, which vests ownership of the NNPC Limited on the Federal Government through the Ministry of Finance, which are both financed by the Nigerian people, but recognizes NNPC limited as an agent.

“Also cognizant that Section 88 of the Constitution of the Federal Republic of Nigeria, 1999 (as amended) empowers the National Assembly to carry out investigations into matters to which it has powers to make laws,” he said.

He added the need to boost investors’ confidence and enhance transparency and efficiency in the supply chain management of the newly established NNPC Ltd, owing to the outstanding credit sales and the much-needed revenues by the federal government to support annual budgets.

Speaker Femi Gbajabiamila said that the committee, when constituted will have eight weeks to carry out its investigation and report back to the house.

The World Bank recently stated that Nigeria spends $4.5 billion on fuel subsidies, indicative of 2% of GDP or 35% of oil and gas revenue.

According to the World Bank, benefits of the PMS subsidy overwhelmingly accrue to wealthier households, and a large share is captured by smugglers and black marketeers. Households in the bottom 40% of the income distribution account for less than 3% of all gasoline purchases.

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