Connect with us

House of Reps to probe $8bn shortfall in NNPC oil deal

Today's Scoops

House of Reps to probe $8bn shortfall in NNPC oil deal

The House of Representatives is to constitute an ad hoc committee to probe an alleged $8bn discrepancy in an oil exchange deal, brokered by the Pipeline and Products Marketing Company (PPMC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC).

According to the lawmakers, the investigation is particularly on crude oil swap contracts, to ascertain “that revenue from the nations extractive industries are transparently managed in accordance with global best practices.”

This was sequel to the adoption of a motion by a member, Michael Enyong (PDP, Akwa Ibom).

The motion was titled “Urgent need for a forensic Investigation of the contract known as ” Refined products Exchange Agreement or Swap Contract “between the Pipeline and Products Marketing Company ( PPMC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC) and Oil Trading Companies.”

The lawmaker while arguing his motion said that Refined Products Exchange Agreement or SWAP to the tune of 445, 000 Barrels per day were awarded to nine companies, viz: Sahara Group, Aiteo, Duke Oil, Mercurial, Glencore, Taleberas Nig. Ltd, Etena Oil and Gas, Transfigura and Ontario Oil and Gas.

According to him, Sahara Group, received 90,000 barrels per day (BPD through an agreement with Societe Ivorienne De Refinage, Aiteo received 90,000 barrels per day, Ontario Oil and Gas Nig. Ltd received 30,000 barrels per day.

“While one barrel, of crude equals to 159 litres, the 445,000 barrels awarded to the above companies per day, when multiplied by 159 litres would amount to 70, 755, 000 litres per day. Whereas Nigeria consumes 40,000,000 litres per day.

Eyong noted that the Nigerian Extractive Industries Transparency Initiative (NEITI), in its 2009-2011and 2012 reports had ascertained that there was a staggering recap venue loss of $8 billion due to the discrepancy between the value of the crude oil given out and to refined products delivered.

He said in 2011, there was a shortfall of 500, 075, 32 litres of refined products by some companies including Transfigura (173,786, 600 litres), Vitol (654,440 litres), Telaveras (152, 308, 878 litres), Aiteo Ltd. (193,046,590 litres) and Ontario Oil & Gas (180, 278, 732 litres).

The lawmaker noted that the request for the investigation of the oil swap deal is in conformity with anti- corruption stance of the three Arms of government of Nigeria “particularly the nation’s President, Muhamadu Buhari.”

He further spoke of the need to ensure transparency and accountability by the Nigerian National Petroleum Corporation (NNPC) in the management of the revenue accruing to the nation from crude oil, particularly in the prevailing circumstances where the major user of Nigeria’s crude oil, the United States of America, has discovered alternative energy source.

Attempts by former Majority Leader, Leo Ogor in a point of order to truncate the debate by citing procedural error for the presentation of the motion by the sponsor was countered by Femi Gbajabiamila (APC, Lagos) former Minority Leader.

In a counter point of order, Gbajabiamila reminded his colleagues that it was agreed on Tuesday that due to importance of motion like that, rules should always be suspended to accommodate them.

Arguing against the motion, Nnana Igbokwe (PDP, Imo) saw no need for the House’s intervention again since Mr. President has already directed the Department of State Services (DSS) to commence investigation of the oil swap deals.

Razak Atunwa (APC, Kwara) and Emmanuel Oghene (PDP, Lagos) in their contributions noted that Igbokwe’s assertion was not right because the gravity of the consequences of the oil swap arrangement on the nation should make it mandatory on the House to carry out its own investigation.

The Speaker, Yakubu Dogara while ruling on the motion after commenting that it was an important motion, said an adhoc committee would be set up to commence the investigation.

Source: The Nation

Click to comment
To Top