NNPC, DPR, oil majors to refund N2.8 trillion : — Ribadu report

[DT]

Government agencies and major oil companies are to refund about N2.8 trillion to the Federation Account, being funds illegally withheld over the past 10 years, according to details of the leaked Ribadu committee report. A copy of the 178–page draft report seen by Daily Trust yesterday revealed that the Nigerian National Petroleum Corporation (NNPC), Department of Petroleum Resources (DPR), Shell Nigeria, Addax oil company and Nigeria Liquefied Natural Gas (NLNG) are among entities that will be asked to make a refund totaling $17.8 billion. The report of Nuhu Ribadu-led Petroleum Revenues Task Force has generated controversy since last week when it first leaked in the media, and yesterday a member of the panel told Daily Trust that there are attempts to discredit the document ahead of its submission to President Jonathan tomorrow.

If the report reaches the President as leaked and its recommendations implemented, NNPC will be made to refund $13 billion (about N2.19 trillion) being the total outstanding amount due to the Federation Account in the past 10 years.

"The review revealed that over a 10 year period (2002 -2011), the state may have been short paid by an estimated sum of US$5 billion, although it was understood from discussions with NNPC officials that the pricing of domestic crude oil was based on international prices," the report said.

"Enquiries from NNPC revealed that up until October 2003, NNPC was granted fixed price regimes which explain the wide disparity in prices in the earlier years."

The Task Force found that the exchange rates used in arriving at the naira equivalent of the amounts payable differed from the CBN rates for six of the ten years reviewed.

"The potential underpayment of amounts payable to the Federation Account over the 10- year period is estimated at N86.6 billion," it added.

The report said NNPC is owed N27billion including current debt, total overdue, disputed debt and total debt outstanding by the major marketers of petroleum products.

"We also found that amounts payable to suppliers of petroleum products, as at 31 December 2011 amounts to approximately US$3.6 billion, of which US$2.7 billion represents amounts outstanding for over 365 days," it said.

The task force recommended that henceforth no deductions should be made from the amounts payable to the Federation Account by the NNPC and that the domestic crude oil should be sold at international competitive prices.

The total outstanding for DPR and Addax Petroleum Company, according to the report, is $3.35 billion.

"The task force found that $3.027billion was outstanding from the operators for crude oil royalties as at 31 December 2011 per the DPR's records. Of this amount, the DPR had stipulated that ADDAX is liable to pay $1.5billion royalties under the 2003 fiscal regime and there is currently a dispute between Addax and NNPC on the one hand, and the DPR on the other," it said.

The Ribadu's report recommended that DPR should take action and enforce collections of the amounts due of $3.027 billion from relevant operators within the remit of the law.

For Shell, the task force identified a total of $946.878 million due to the Federation Account from SNEPCO representing the proceeds of gas sales from the Bonga oil field.

"For Liquefied Natural Gas, the price observed at which the feedstock gas is sold to NLNG seems too generous, compared to prices obtainable on the international market. The estimated cumulative of the deficit between value obtainable on the international market and what is currently being obtained from NLNG, over the 10 year period, amounts to approximately US$29 billion," the report said.

Intrigues, as Ribadu c'ttee meets

The Ribadu committee report is due to be presented to Jonathan tomorrow, but a committee member told Daily Trust there are efforts to discredit it.

When the report leaked last week, Petroleum Minister Diezani Alison-Madueke said the document was merely a draft in which government was to make an input.

Newspapers yesterday quoted a committee member Chief Anthony George Ikoli (SAN), who is former Bayelsa State attorney general, disowning the leaked report saying "the committee's work is factually yet to be definitively concluded."

Another committee member was quoted in the media as accusing Ribadu of failing "to carry all members along in the assignment."

But a different committee member who craved anonymity yesterday told Daily Trust that he was not surprised at the comments in the media by people who might have leaked the report in order to find avenues to discredit it.

"I am also not surprised because the most dangerous thing you can do in Nigeria is to take an adventure into the realm of oil revenues; you will certainly be stopped by one cartel or the other," the committee member said.

"When the first draft was written, we were all given copies and asked to go through and make comments and suggestions. To the best of my knowledge, no one disowned any statement of fact. The only comments that came indicated that the use of language in some places was harsh," he added.

The member said the panel will meet today on the final draft report before submitting it to the President tomorrow. He said Mrs Alison-Madueke will also attend the meeting.

The committee, he said, had submitted to the minister a draft copy of the report about two months ago and has awaited her input since then. "The time in between was too long so I am not surprised that someone, somewhere leaked the report, probably to achieve a goal," he said.

The source revealed that certain forces had attempted to disrupt the committee in the course of its work but could not achieve their aim due to the determination of many members who were interested in seeing the job done in the national interest.

Daily Trust

[KingFemzee]

I just pray the feeble president we have stands up to its responsibilities for once and bring corrupt officials to justice.

[Nifemi Donald]

I am just fed up of the high level of corruption in this country