Senate, Reps probe NNPC again

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

The Senate has also summoned the NNPCto examine the conditions of the nation’s four refineries.

According to members of the House of Representatives, the investigation is particularly on crude oil swap contracts, to ascertain “that revenue from the nation’s 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, AkwaIbom).

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 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, Muhammadu 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.