The House of Representatives Public Accounts Committee (PAC) has constituted two technical sub-committees to ascertain the level of indebtedness of unpaid royalties, remittances by the Nigeria National Petroleum Company Limited (NNPCL), Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and other oil and gas companies operating in the country.
The sub-committees, headed by the Deputy Chairman, Rep. Jeremiah Umaru, and Rep. Olusola Fatoba, are to work on the issues raised by the committee based on a 2021 audit report of the Office of the Auditor General of the Federation (AuGF) on the consolidated financial statement against NUPRC.
The issues include; “Outstanding royalties due from NNPC-COMF MCA/PSC totaling $253,952,693.07, unjustified deductions from joint venture Royalty by NNPC before Remitting to DPR (now NUPRC) totaling $204,853,744,047.39.”
The other issues are; “Outstanding royalties on oil, gas, concession rentals and gas flared payable by operators to federation account totaling $2,260,448,992.45 and N48,216,163,192.67, among others”.
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The Public Accounts Committee (PAC) chaired by Rep. Bamidele Salam, made the decision over the issue at its investigative hearing held on Monday.
The Chief Executive of NUPRC, Engr. Gbenga Komolafe, who appeared before the committee, while responding on outstanding royalties, said $224.3 million has been paid out as part of the outstanding revenue due from NNPC as of 31st Dec leaving a balance of $29.6m that is still outstanding.
He said, “NUPRC has sent a series of demand notices to the NNPC to clear the outstanding debt and even reported them to the Honourable Minister of Finance to intervene but to no avail.
“The NUPRC has a revenue collection strategy which includes sanctions and invocation of fine and penalty sections of PIA 2021”.
He, however, said the NUPRC has limitations in applying necessary sanctions against the NNPC and other licensees in the oil and gas sector.
According to him, the agency was conscious of the volatility of the industry as well as Nigeria’s economic dependence on oil revenue to avoid anything that can cause untoward effects.
He assured the committee that the agency will always operate within the law and uphold best corporate governance policies.
In his remarks, Chairman of the Committee, Rep. Bamidele Salam, assured that, it will be fair and open in considering all queries by the auditor general as well as other issues before it.
He added that, PAC as a committee that investigates MDAs on various administrative and financial issues, would not pronounce anyone guilty until it provides ample opportunity for defense through an open hearing.
The chairman and members of the committee demanded proof from the NUPRC that the various sums of monies alleged by the Auditor General of the Federation as uncollected revenue from the NNPC and major oil and gas operators have been recovered since the end of the 2021 financial year.
The committee unanimously constituted the technical sub-committees to ascertain the state of indebtedness of NNPC and others in the Oil and Gas sector.
They are to report back in two weeks for further action.
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