The Nigeria National Petroleum Corporation (NNPC) is currently being scrutinised by the Wole Oke-led
The billion naira waste Nigeria incurs fixing its leaking pipelines and subsidising petrol is no longer news, but what is news is the opportunity cost forgone by this waste in a creaking economy.
The Nigeria National Petroleum Corporation (NNPC) is currently being scrutinised by the Wole Oke-led House of Representatives Committee on Public Accounts (PAC) over an alleged failure to remit N4 trillion into the federation account as contained in a report from the office of the Auditor-General for the Federation.
In response, a representative of the NNPC group managing director, Mele Kyari, justified the deductions by saying that it was in line with the law that established the corporation.
“What we do is backed by the provisions of the law. First, the NNPC Act is very clear that we should submit the net revenues of our cost,” the NNPC told lawmakers at the meeting Wednesday in Abuja.
Umar Ajiya, NNPC’s chief finance officer, who represented the GMD, conceded that “there is confusion within government circles at the moment for which a lot of consultations are ongoing on how to handle the implication of sustained subsidy.”
He was responding to a report by the Auditor-General of the Federation claiming the NNPC did not remit N4 trillion.
The corporation admitted that fuel subsidy and other costs accounted for the shortfall in remittance.
However, the issue has further raised concern about how urgently Nigeria plans to reform its alleged corrupt national oil company through a new oil bill yet to be passed after 20 years of first presentation.
Financial experts have raised concern about the opaque system that is bleeding Nigeria’s economy considering the high level of life-threatening hunger in a country with over 95.9 million people living in extreme poverty.
For instance, Emerald Energy Institute at the University of Port Harcourt estimated the construction cost of a 100,000-barrels per day (bpd) refinery plant at $2 billion (N600bn). This means the unremitted N4 trillion could have helped the country construct at least six of such refineries, instead of importing light petroleum products estimated at $15 billion per annum.
Primary health centre, education
Using Freedom of Information requests and analysis by transparency campaign group Public Private Development Centre, it would cost an estimated N28 million to build primary healthcare centre and N17 million for a 3-classroom block. This means N4 trillion is capable of building 142,857 primary health centres or 235,000 blocks of classrooms needed across Nigeria’s 774 local governments.