Ribadu commitee exposes how presidency, NNPC spend oil revenues as slush funds

The Nuhu Ribadu-led Petroleum Revenue Special Task Force has detailed how the Nigerian government and national oil company, Nigerian National Petroleum Corporation, treat huge oil revenues accruing to the federation as a reserve of money that could be used for illicit purposes without accountability.

In its 178-page report, obtained by PREMIUM TIMES last night, the committee revealed how oil money in the custody of the NNPC were spent on extra-budgetary purposes such as the acquisition of a N2.23billion chopper for the president and a purported sponsorship of the World Cup.

In what appears a brazen misuse of public funds, the NNPC also gave out N700.5million in loan to Sao Tome & Principe based on instruction from the presidency. It also made a curious payment of N2.421billion to a foreign company, Royal Swaziland Sugar Company. The reason for the payment is unclear.

The Corporation also claimed to have underwritten a N521million expenses incurred by the Federal Ministry of Petroleum Resources. This is in addition to the N250million the agency told the committee it spent on court cases involving the ministry.

The ministry has its own budgetary allocation and it is unclear why the NNPC is paying for its expenses. The nature of some of the expenses are also unclear.

The committee also found that the NNPC was being used as illegal lender to presidential committees, ministries and parastatals. For instance the corporation claimed it incurred about N20billion on the Presidential Implementation Committee on Maritime Safety and Security, based on instruction from the presidency.

The Ribadu committee also determined that about $1billion in signature bonuses, discrepancies in payment by the NNPC, and debts from oil companies were unaccounted for by the NNPC and the Department of Petroleum Resources.

Find table of missing money as documented by the Ribadu committee below. Download full report of the committee here.

Excerpts of the report

“…Theft of crude oil and refined petroleum products may be reaching emergency levels in Nigeria. The Task Force has received reports suggesting that volumes stolen have risen dramatically in the past 12-18 months. The Royal Dutch Shell Company, Shell in its presentation to the Task Force stated that an estimated 150,000 barrels of crude oil are stolen per day (about 6% of Nigeria’s total annual production) causing a revenue loss of $13.5 million per day (at $100 per barrel) which amounts to $5billion per year of lost revenue.

On the other hand, high ranking Officials and Executives in the Federal Government tasked with the management of the nation’s strategic Oil and Gas assets have several times stated the existence of large-scale on-going theft of Nigeria’s crude oil. This represents government acknowledgment of the magnitude of the loss. Mr. Leke Oyewole, a Senior Special Adviser to President Goodluck Jonathan on Maritime Affairs, disclosed to the media in March, 2012 that Nigeria loses about 40 million metric tonnes of petroleum products amounting to about $20 billion (N3 trillion) to crude oil theft and illegal bunkering; while NNPC has publicly stated that it spent $1.2billion in the last ten years on pipeline repairs.

Further to the above, the Honourable Minister of Petroleum Resources had also stated at a media briefing in May, 2012 that the country was losing about $7billion annually to crude oil theft in Nigeria, at the rate of 180,000 barrels per day. Indeed, President Goodluck Jonathan has acknowledged the scale and seriousness of crude oil theft in Nigeria as being incomparable to anywhere else in the world, describing the occurrence as being cancerous to the nation’s economy.

The Ministry of Finance has taken a middle ground, stating theft claimed 17 percent of daily production nationwide in April. Overall, estimates of crude oil stolen or spilled reviewed by the Task Force ranged from 6 to 30 percent of production, with 35 percent claimed for one especially troubled area. Based on these estimates, the Task Force believes Nigeria could be losing over N1tn per year to crude oil theft.

The Task Force does not endorse any of the numbers it received as solely authoritative. The bases for many were unclear, and the decentralized, secretive nature of oil theft makes it difficult for any one party to know the full extent of losses. There is a lack of consensus on the actual loss, naturally public records are not satisfactory in this regard but it could actually be as high as 250,000 barrels per day closer to 10% of daily productions.

However, submissions to the Task Force on oil theft suggest that the problem needs immediate attention.

NNPC and oil company data shows dramatic recent rises in theft and sabotage. For example, Shell claims it found at least 50 tap points on its 90km Nembe trunk line in January 2011 alone. Shell submissions to the Task Force showed average total losses in its operational areas climbing from 10,000bpd in late 2009 to over 50,000bpd in March 2012. Chevron reports 29 tap points for the year so far, and claims volumes lost from its operations in Q1 2012 exceeded losses for all of 2011. The NNPC put its total losses from 2009 to Q1 2012 at over 20mn barrels.

It appears small-scale theft and illegal refining are also becoming more decentralized and wide spread, though losses from such practices remain relatively small compared with the more sophisticated large-scale theft rings. In one striking example of rising costs, NNPC data shows the value of stolen crude along the 60km Forcados-Warri refinery supply pipeline was 600 percent higher in 2011 than in 2010. Total losses were N60 billion from this pipeline alone’ or N1bn of oil stolen per km of pipeline.

These incidences of crude theft also delay realization of revenues by deferring production. Shell has declared force majeure on onshore liftings five times since early 2011, all reportedly linked to illegal bunkering. One December 2011 stoppage, allegedly caused by two failed pipeline taps, took a month to fix and deferred over 4 million barrels. Damage to infrastructure also causes long-term production deferments. Government data shows dozens of fields sabotaged before the amnesty still sit idle. Shell’s onshore output’ currently around 600,000bpd’ is barely half of 2005 levels. In Delta State, Chevron still produces one third less oil than it did in 2008…”


DOWNLOAD THE PREMIUM TIMES MOBILE APP

Now available on

  Premium Times Android mobile applicationPremium Times iOS mobile applicationPremium Times blackberry mobile applicationPremium Times windows mobile application

TEXT AD:"Warning to Men, These 3 Foods is Slowly Killing Your Erection". Click Here to Know Them


All rights reserved. This material and any other material on this platform may not be reproduced, published, broadcast, written or distributed in full or in part, without written permission from PREMIUM TIMES.


  • angryniger

    this is not rocket science, The minister for petroleum, GEJ and Patience Jonathan, Bola Shagaya, and the minister of aviation are all involved neck deep, but like every other probe,this will die a natural death. How do you justify Femi Otedola who has been accused in the subsidy scam being alway visible in #Jonathan’s cabinet, one of the so called “wise men”. UNTIL WE TAKE THIS PEOPLE TO THE UN, I CANNOT SEE ANYTHING POSITIVE COMING OUT OF THIS REPORT

  • akpos1

    Nigeria is not a country but a Continent. There is no country where this kind of evil is perpetrated by government officials. The truth is that in Continent Nigeria, no one, I emphasize, ‘No one’ is patriotic to Nigeria because it is not a country. Everyone is loyal to his or her own country of origin- West, East, South South, South East, North etc. and so, every official steals with no recourse to the effect on the owners of the wealth and the citizens of the individual constituent countries.

    The separate nations existed before the evil intervention of the stupid British who invaded our land and forced the animals and low IQ peoples of the North to live with the dynamic, progressive and liberal South.

    Therefore, to solve the problem, simple disintegrate the countries within continent Nigeria into their independent status. Then the Northanstan governments can have their destiny in their hands and spend 365 days of the year planning pilgrimages.

    Long live the Federal republic of the SS & SE

  • Ajetun blog

    Nigeria my country..hmm

  • Nick

    I told Jona not to give this job to this boy, he didn’t listen. Now can he ignore all these allegations?

    • Vking

      Nick is people like you that keep Nigeria on crawling level.May God have mercy for you.GJE mean well for Nigeria.I will still find out who you are,bet me.

  • NAGODI_1

    OUR FATE AS A NATION WAS SEALED WHEN WE REJECTED TWO OTHER PRESIDENTIAL CANDIDATES AND EITHER VOTED OR ALLOW THE PDP TO RIG THE ELECTION FOR A AMN WHO WAS SO SCARED OF TURAI YARADUWA THAT HE REFUSED TO ASSERT HIS POSITION EVEN WHEN IT WAS CLEAR THAT YARADUWA WAS DEAD. (CAN ANYONE REALLY EXPECT HIM TO STAND NOW AGAINST THE CRIMINAL CABAL THAT RUN THIS SCAMS WHEN HE COULD NOT STAND UP TO TURAI YARADUWA?) A MAN WHO COULD NOT SIT WITH HIS OWN PEERS AND DEBATE IN THE OPEN ON NATIONAL ISSUES THAT CONCERN LEADERSHIP. A MAN WHO AS GOVERNOR OF BAYELSA WAS INDICTED BY SEVERAL REPORTS OF DISHONEST DEALINGS AS THE STATE CHIEF EXECUTIVE. A MAN WHOS WIFE WAS ALSO INDICTED BY A REPORT FOR MONEY LAUNDERING. A MAN WHOS ONLY CREDENTIALS FOR THE HIGHEST OFFICE IN THE LAND IS THE FACT THAT WHILE GROWING UP HE HAD NO SHOES. BOTH HIS DEMEANOUR AND BODY LANGUAGE SHOWS A MAN WITH SERIOUS ISSUES OF SELF DOUBT, LOW SELF ESTEEM AND INFERIORITY COMPLEX. BABANGIDA SAID AS MUCH WHEN HE TOLD GEJ THAT THOSE WHO FORCED HIM TO RUN FOR PRESIDENT HAVE DONE A DISSERVICE TO HIM AND THE NATION.

    FOR THOSE WHO STILL THINK SOMETHING WILL COME OUT OF THIS REPORT REFER BACK TO WHAT GEJ PROMISED DURING HIS CAMPAIGN AND WHAT HE CHOSE TO START WITH AFTER HE WON THE ELECTION. OUT OF THIN AIR HE BROUGHT OUT THE ‘SIT TIGHT’ TRICK OF A SINGLE TERM. THAT FAILED AND HE TURNED TO THE REMOVAL OF “SUBSIDY”, AN ISSUE HE NEVER MENTIONED DURING HIS CAMPAIGN. JUST A YEAR INTO HIS ADMINISTRATION WHAT WAS LEFT OF OUR INFRASTRUCTURE HAS COMPLETELY COLLAPSED. INSECURITY HAS REACHED BIBLICAL PROPORTIONS AND INFLATION IS RUNNING ALMOST AT THE SAME PACE AS DURING THE DARK DAYS OF BABANGIDA, THANKS TO THE INHUMAN, HEARTLESS AND SADISTIC ARBITRARY FUEL PRICE HIKE IN THE NAME OF “SUBSIDY REMOVAL”.

    I WAS A BIT SCEPTICAL WHEN RIBADO ACCEPTED TO PROBE THE OIL SECTOR, NOW I SEE THE SENSE IN IT. NIGERIANS WOULD HAVE SEEN HOW THE RESOURCES OF THE LAND ARE PLUNDERED. WE KNOW THAT A CORRUPT AND INEPT PRESIDENT WILL HAVE BOTH HANDS TIED TO HIS ARSE SINCE HE IS NECK DEEP IN IT, BUT NIGERIANS WILL KNOW. KNOWLEDGE OF THE PROBLEM IS LIKE 50% OF THE SOLUTION. I WISH TO THANK RIBADO FOR HIS FORESIGHT IN PRODUCING THIS MONUMENTAL DOCUMENT THAT FUTURE PRESIDENTS WILL FIND USEFULL IN PROSECUTING THE CORRUPT.

    • Mpitikwelu_na_Ugwu_Awusa

      If you are still sulking because we didn’t elect a muslim extremist, Buhari, you will sulk longer in 2015. I am totally in support of probing GEJ after his tenure, so far, we see IBB, Abdulsalami and Buhari in court,

    • Ti

      Its all about interest, my people let us wake up. Give Nuhu Ribadu or ever he us called what he wants and that’s it. He simply mean no good for you other than him self.

  • ishaya yakubu

    NNPC should go

    • Mpitikwelu_na_Ugwu_Awusa

      God bless you. It is a criminal enterprise.

    • NAGODI_1

      … AND THE SAME PEOPLE WHO SET IT UP WILL SET UP ANOTHER WITH A NEW NAME. LET THOSE RESPONSIBLE FOR THE PROPER WORKING OF THE NNPC BUT FAIL GO, LEAVE THE NNPC ALONE.

  • Enemona

    Pls stick to the issue. The issue is corruption in the oil sector and the current administration. Is that too much to grasp for you or are you just plain ignorant?

    • NAGODI_1

      I WONDER ENEMONA, AND ALL THIS RANT WHEN THE PRESIDENT IS FROM THE SOUTH-SOUTH.

      • Mpitikwelu_na_Ugwu_Awusa

        And you know where Akpos is from?

        • NAGODI_1

          WELL I DONT HAVE TO, HE WANTS A SOUTH-SOUTH STATE AND I THOUGHT THE BEST PERSON HE SHOULD TELL IS THE THE MAN WHO HAS THE POWER TO MOVE THE POLITICAL DEBATE TO THAT SIDE. THAT MAN HAPPENS TO BE SITTING HIS ARSE OFF IN ASO ROCK SENDING CONDEMNATIONS WHILE NIGERIANS DIE IN DROVES. HE IS FROM THE SOUTH-SOUTH.

    • Mpitikwelu_na_Ugwu_Awusa

      Unlike Akpos has gone beyond mentioning the corruption in the oil sector to suggesting what feeds the corruption. Unlike you, Akpos has acknowledged that this corruption did not just start with the current administration as you implied.

  • Bebeji

    Sacred cows make the best hamburger!!We are watching the outcome of this extraordinary report.

  • Kpako

    You no talk the money spent on efcc by NNPC during your tenure!

  • AFAM

    i wonder where you got your report that indicted the presidency,junk journalism is what will kill the FOI bill one day…….this was part of the report made available by the chairman of the committee, Ribadu who added that the former HOSF flew into the country just yesterday to be part of the report presentation. “I think our President deserves respect more than what we have got now”, he added.

    The former EFCC Chairman also noted that the disagreement of the two men with the report which indicted the Minister of Petroleum Resources may have been influenced by their new appointments. Ribadu noted that Oronsaye got himself appointed as a member of the board of Nigeria National Petroleum Corporation in the course of the work of the Task Force, while Oti was appointed into a managerial position in the Corporation.

    He said the two men should have resigned their position following their appointments, but they refused to do so. In spite of this disagreements however, President Jonathan said the report of the Ribadu Committee still stands. He spoke after the Minister of Petroleum Resources had presented the report of the Ribadu Committee and that of the two other Task Forces to him.

    The President who said it is normal to have disagreements among members of a committee said while the two dissenting voices did not constitute clear majority, government is ready to accommodate their observations in the report.

    He asked the two dissenting men to submit their observations to his office or the Petroleum Minister, even as he assured that government is not interested in hiding anything and if there are any allegations of stealing against anybody in the report; it will be referred to EFCC for investigations. He also defended the appointments of the two men into positions in NNPC, arguing that there is nothing wrong in doing so.

    The Task Force on Governance Structure led by Dotun Suleiman was the first to submit its report. Suleiman said the report of the Task Force dealt with high governance issues, key performance indicators process control mechanisms and structure for the transitional phase of the industry from government controlled to an independent operator as envisaged in the Petroleum Industry Bill. The Task Force suggested the creation of Nigeria Petroleum Inspectorate as a single regulator of both the upstream and downstream sector of the oil industry among other new bodies it suggested should be created. In its own report, the Task Force on refineries noted that all Nigerian refineries are in a very terrible state.

    Mallam Yusuf Ali, the alternate Chairman of the Task Force also said the members developed a self sufficiency plan for petroleum products in Nigeria within a strong commercial framework in the shortest possible plan for Nigeria in the report. The Committee recommended privatization of the existing refineries with 18 months and full deregulation of the downstream sector of the oil industry.

    The Task Force also said government should establish three Greenfield refineries, in Lagos, Kogi and Bayelsa State either through a joint venture or any other arrangement. The Task Force noted that in the past 10 years, the highest capacity utilization of the three refineries was 44 per cent attained in 2005 and the lowest was in 2009 when the refineries operated at capacity level of only 18 per cent. The Task Force said part of the problem of refineries is pipeline vandalisation and theft of crude oil.

    Ribadu had also earlier said recommendations contained in the report of his committee will not only strengthen the Nigerian oil industry, but will result in greater revenue for Nigeria. The former EFCC Chairman said though some of the recommendations contained in the report of his Task Force may be considered harsh, they are the truth.

    Ribadu said government should put pressure on the Department of Petroleum Resources to ensure the collection of taxes and revenues due to Nigeria from the operators in the oil industry. He said NNPC should stop the use of traders in the sale of its crude oil as Nigeria is just one of the two countries doing so throughout the world.
    According to him, other countries sell their crude oil straight to the refineries that will use them. Ribadu also described the scale of theft of crude oil in Nigeria as a national tragedy while emphasizing that only a person of integrity can carry out reforms.

    The Minister of Petroleum Resources who said she did not interfere with the work of the Task Forces said government will look at the recommendations. She also said the NNPC and the Ministry will as from next week meet with the Task Forces again on the different recommendations and conclusions contained in their reports.

  • bono

    Sad that ribadu missed out on the amount of money spent by his godfather obj when he was minister of petroleum resources for over 6 yrs. The nation has spent over 55 trillion naira since oil was discovered in the SS. If ribadu cannot probe the affairs of oil ministers such as rilwanu lukman then he should just ship out-the oil does not belong to every nigerian-its the property of the south south-that is why the fulani group from the North are scared of a split-OBJ also gave out loans to Ghana. Where did the money come from. He has already tarnished his image period. Thought they told us he was hired by jonathan to cover up for his sins-is that the case now?

  • suny lulu

    Forensic investigation into the NNPC accounts is long overdue.