'FG owes N4.207trn' - NNPC finally speaks on alleged indebtedness to FG

The Nigerian National Petroleum Company Limited (NNPCL) has said it is working with relevant parties in the reconciliation committee set up by President Bola Tinubu to investigate, review, and reconcile the financial records on alleged indebtedness to the federation.

Olufemi Soneye, NNPCL Chief Corporate Communications Officer made this known in a statement on Monday 6th November 2023 according to ChannelsTV report. NNPC stated that the development was necessary following the call for a probe by an unnamed non-governmental organization (NGO).

The NGO had demanded an investigation on monies that were allegedly owned by the NNPC to the government.

Legit.ng reported that the NNPC failed to remit about $6.8 billion to the federation account.

NNPC defends

In its response, the NNPC said that the claim was baseless. It cited the fact that NEITI in a 2021 report had dismissed many of the allegations after engaging with the NNPC Limited.

At the beginning of Tinubu’s administration, the company explained that it sold imported premium motor spirit (PMS) at one-third of its value. It noted that this resulted in an average of N400 billion monthly subsidy bill.

According to Soneye, this put a strain on its revenues and finances.

In a breakdown, the company revealed that as of May 31, 2023, the subsidy bill had reached over N3.736 trillion.

It added that due to non-payment of its share of upstream joint venture gas supplied to government-owned plants, the federation’s debt accumulation of N174.07 billion.

As of 31st May 2023, it added that the receivables due from the federation to NNPC Exploration & Production Limited (NEPL) were $712million (equivalent to N309.07 billion at N434.08/US$1).

Accumulating all debt, it said, “While the Federation owed NNPCL the sum of N4.207 trillion as net indebtedness, the Company was only indebted to the Federation in the sum of N2.852 trillion, made up mainly of outstanding Good and Valuable Consideration (GVC) in respect of government upstream divestments, royalties and Petroleum Profit taxes (PPT).