Nigeria owes IOCs $5.1b, says NNPC

NIGERIA indebtedness to International Oil Companies (IOCs) stood at $5.1 billion, the Nigerian National Petroleum Corporation (NNPC) told the Senate yesterday.

The $5.1 billion, according to the Corporation, was accumulated from the Joint Venture Cash Call (JVC) business arrangement the country has with IOCs on oil exploration.

But the NNPC denied allegation of mismanagement of $3.2 billion said to have been withdrawn from the Nigerian Liquefied Natural Gas (NLNG) account between 2015 till date.

The Chief Financial Officer (CFO) of NNPC, Isiaka Abdulrasaq, who appeared before the Senate Committee on Gas explained how the debt was incurred.

Abdulrasaq told the panel that the JVC is a business arrangement between the Federal Government and the IOCs, explaining that Nigeria controls 60 per cent of the business venture and the IOCs the remaining 40 per cent.

He NNPC official said: “The problem, however is that before this government came on board in 2015, Nigeria which holds 60 per cent of shares in the joint business, for many years did not contribute its own required capital into it.”

Nigeria, he said, was “only collecting its equity share inform of revenues which made the country as at 2015, to have $6.8 billion unpaid capital into the venture.”

He further explained that “the present government in 2016, succeeded in getting 35 per cent discount from the unpaid capital amounting to $1.9 billion from the unpaid capital, making the country to still owe the IOCs $5.1 billion outstanding.”

On the alleged $3.2 billion reportedly withdrawn from the NLNG account by the NNPC within the last three years, the CFO insisted that there was no mismanagement in any of the withdrawals made.

He noted that based on available records with NNPC, only 13 withdrawals were made from the account amounting to $1.2 billion.

The official said that more than seven IOCs dealing with the NNPC have expressed concern about the continuity of their business operations as a result of bogus figures being bandied about withdrawals from the NLNG account.

Chairman of the committee, Senator Albert Bassey Akpan, asked the NNPC CFO to submit approving documents for all the withdrawals by Tuesday next week.

Akpan said: “We are not saying any money has been stolen. What we are doing is clarifying the processes of expenditures made from the account with a view to making management of the account more transparent and beneficial to Nigerians.”