Forensic Audit Report: Sanusi’s claims incorrect — Auditor General

Samuel Ukura, Former Auditor General For the Federation

The Federal Government ordered forensic audit on the operations of the Nigerian National Petroleum Corporation, NNPC, has indicted the national oil company for various questionable transactions.

Highlights of the recommendations by the audit firm of PriceWaterhouseCoopers, PwC Nigeria, which conducted the audit, asked the Nigerian Petroleum Development Company, NPDC, the upstream subsidiary of the NNPC, to refund a total of $1.48billion (about N248.6billion) to the Federation Account for various unreconciled transactions.

The Auditor General of the Federation, AuGF, Samuel Ukura, who said he was presenting the highlights of the report at the request of President Goodluck Jonathan, pointed out that it was not his responsibility to present such audit reports to arms of government other than the National Assembly in line with the Constitution.

According to Mr. Ukura, contrary to the allegation by the former Central Bank of Nigeria, CBN, Lamido Sanusi, that only $67billion was the total unremitted revenue from crude oil lifting by the NNPC between January 2012 and July 2013, findings by PwC Nigeria showed that the total amount involved was $69.34 billion.

He said the amount included about $28.22billion, being the value of the domestic crude oil allocated to the NNPC for local refining during the period, while total cost directly attributable to domestic crude oil was $1.46billion.

In addition, he said total amount spent on subsidy for premium motor spirit, PMS, or petrol, was about $5.32billion, while a similar expenditure for dual purpose kerosene, DPK, or diesel stood at about $3.38billion.

Other third party financing arrangements, including equity crude oil processing costs, the report said, was $1.19billion, while other costs incurred by NNPC that were not directly attributable to domestic crude oil was $2.81billion.

According to the report, total revenue submitted by the NPDC, after petroleum profit tax, PPT, and Royalty were deducted amounted to $5.11billion, pointing out that the amount needs to be included in the financial statements of the company from where dividend should be declared to the Federation Account.

It noted that signature bonus PPT and royalty yet to be paid by NPDC to the government stood at about $2.22billion.

“Total cash remitted to the Federation Accounts in relation to crude oil liftings for the period from January 2012 and July 2013 was $50.81billion and not $47billion,” the report said. “Based on the information available to PwC and from the analysis above, the firm submitted that NNPC and NPDC should refund to the Federation Accounts a minimum of $1.48billion.”

Further analysis, the AuGF said, centred on NNPC costs, ownership of NPDC revenues and DPK subsidy, pointing out that the corporation was operating an “unsustainable model”.

While 46 per cent of the revenues realized from domestic crude oil for the period was spent on its operations and payment and subsidies, the NNPC was unable to either sustain its monthly obligation to remit to the Federation Account Allocation Committee, FAAC, or meet its operational costs from such revenues.

To bridge the funding gap between available revenue and third party liabilities, the report said transaction documents valued at about $2.81 billion, representing additional costs for such funding arrangements based on the NNPC Act No. 33 of 1977 required further clarification to justify such deductions by NNPC as a first line charge.

Echoing the need to revisit the issue of the Petroleum Industry Bill, PIB, currently pending before the National Assembly, the report called for an urgent review and restructuring of the NNPC operational model to bring it up to the global standard.

On ownership of NPDC revenues, the report noted that out of about $1.85billion realized from NNPC’s 55 percent stake in the oil mining leases, OMLs, involved in the Shell Petroleum Development Company, SPDC divestment of from eight OMLs, only $100 million has so far been remitted to government coffers.

Noting that the NPDC had conducted a self-assessment of PPT and Royalty it collected, about $470 million was yet to be remitted, while there were no records to suggest that the company had done the assessment for the period under review.

“NPDC should remit dividend to NNPC and ultimately to the Federation Accounts based on NPDC’s dividend policy and declaration of dividend for the period,” the report said.

On kerosene subsidy, the report said information obtained from the Petroleum Products Pricing Regulatory Agency, PPPRA, revealed that NNPC incurred about $3.38billion cost relating to subsidy for diesel for the period.

Despite a correspondence by the Presidency confirming a 2009 presidential directive stopping payment of subsidy on diesel, and another from the PPPRA to the CBN governor clarifying that the agency had ceased to grant subsidy, kerosene subsidy was not appropriated for in the 2012 and 2013 federal budget.

The report recommended that an official directive be written to legalise the presidential directive on cancellation of subsidy payment on diesel, while also issuing same to support the directive on kerosene subsidy, both of which were not gazette.

“There should be followed by adequate budgeting and appropriation for the costs,” the report.

The audit became necessary after the former CBN governor had alleged that as much as $49 billion was diverted by the NNPC. Though the figure was reconciled between the CBN, Finance Ministry and NNPC, Mr. Sanusi said about $12 billion was involved, while Minister of Finance, Ngozi Okonjo-Iweala said the amount left was $10.8bilion.

Mr. Sanusi later reviewed the amount to $20 billion, and called for investigations, A Senate probe failed to get to the roots of allegation.

In April, Mrs. Okonjo-Iweala, had announced the appointment of PwC Nigeria, to conduct a detailed investigation into the accounts and activities of NNPC.

Though the auditors were given 16 weeks till September 2014 to complete its assignment, the report was coming several months after the deadline, triggering huge concerns from Nigerians, who demanded the release of the audit findings.

Apart from the Presidential candidate of the All Progressives Congress, APC, Muhammadu Buhari, who made the call on government to publish the report, the former Vice President of the World Bank, Oby Ezekwesili also joined to demand for the report.

The former CBN governor, Chukwuma Soludo, also touched on the issue in his recent article accusing the managers of the Nigerian economy of not accounting for several billions of oil money.


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  • tyson

    Every Nigerian knew from the word go that Sanusi was tutored by tinubu to lie against he president 4 months after he was indicted-separation is the answer

    • tyson

      Practically everything about the atrocities of Mohammadu Buhari is in the public domain and one is not going to regurgitate them. But one is presently concerned about his soullessness and wickedness. Any human being who professed disdain for “the Truth” as Buhari did in 1984 is a soulless person. Buhari told Nigerian journalists in 1984 that it did not matter if they wrote and printed “true” stories, if he Buhari or his administration did not like it, they would be jailed. Soulless Buhari went ahead, after jailing Tunde Thompson and Nduka Irabor, to promulgate pro-active laws to murder three innocent Nigerians – Lawal Ojuolape, Bernard Ogedegbe and Bartholomew Owoh. He has never shown any remorse and he has never apologized.

      It was under the Buhari administration that Nigerians first queued for what was then known and called “essential commodities” such as milk, sugar and beverages. Buhari never showed mercy. Rather he gloated, intimidated, threatened and persecuted. He was really mean and cruel to Nigerians. Worse of all, he has not changed a bit. Those who are postulating that he could not do that under a democratic set up are being naïve and uncritical in their thinking. Such people are oblivious of the power of the Nigerian presidency which is imperial in nature and dictatorial in character. The fact that Jonathan is a weakling as a President is irrelevant.

      He allowed Umaru Dikko and Ubah Ahmed (who was actually arrested and detained) to escape to London after the coup of 1983. But because Umaru Dikko would always run his mouth and he was criticizing Buhari’s administration in London, Buhari decided to crate him like a merchandize and have him imported to Nigeria. If not for the vigilance of the always culpable British government, the Nigerian Customs were getting ready to clear Dikko as an expensive luggage. It would be a travesty and a tragedy rolled into one, to have Buhari as the President of Nigeria. Buhari is a dangerous being not fit for any decent society. To install an iniquitous person like him as the President of Nigeria is a disaster waiting to happen.

      “The grounds on which General Buhari is being promoted as the alternative choice are not only shaky, but pitifully naive. History matters. Records are not kept simply to assist the weakness of memory, but to operate as guides to the future.
      Prof. Wole Soyinka

      • WTH

        Youre here again? You sure have a lot of time on your hand posting this crap on every topic. Okay, you have made your point, now go get a real job.Oh, I get it, this is your job since your boss cannt create any.

      • Adetayo Adewale Adebowale

        You be Mumu ,my friend where were you When Mr. Tunde Thompson said Gen. Buhari,Muhammadu did not directly jail him. But a government led by GMB and GM B have no direct link. Check your facts(childrens) barbarians.

  • firghtnight45

    nonsense why did it take this long to make it public audit was carried out by a Nigerian firm that alone is questionable i dont know what this government take Nigerians for.

    • FortB

      Do you read at all? Pricewatercooper House is a London based company. They submitted the report just 2 days ago so what is really your point?

      • firghtnight45

        my point is this is a firm with branches all over the world the fact that this report is coming from Pwc Nigeria the report might be compromised

        • FortB

          Read about the firms reputation. If you watched the report presentation, you would have seen that it was not a Nigerian who presented it.

          • MrFesh+Ifebuche+Paschal

            Don’t mind the ewu

  • Wähala

    We want the beef, not the crumbs from the forensic report…
    Mr. AuGF should publish the report and allow Nigerians peruse thru what taxpayers paid for, not some Govt. redacted interpretation of the report after removing the most damning details. If Dr. NOI could not find $10.8bn as she testified at the NASS, how and where did the forensic examiners find the missing money? That and other lingering questions are the reasons Nigerians must read the full, unedited report… we’re not in hurry so, no one needs a summary. Thieves. Buhari will soon re-order a more comprehensive auditing of the NNPC especially under this thieving administration. Ukura… Bald-headed Liar!

    • Otile

      You don’t make sense hopeless liar. Go hug the transformer.

      • Abdullahi Abba Bukar

        One thing that should be taken into account is, NNPC is still holding some amount close to what it is being accused. Assuming nobody raise alarm the sum will be put in to the pockets of GEJ and his friends. Thanks, Mr Sanusi God bless you.

        • Retired Colonel M.

          You are simply out of your mind’s wits to even conjure something this vile and evil.
          You must be steeped in all things corrupt to even conjure up something this remotely cunning. Too bad for you that this administration has clean hands and will never stoop to you warped way of doing business.

        • Ekerete Etukudo

          how can a human being condone a CBN governor’s inability to put out the right figures about the economy?

    • MrFesh+Ifebuche+Paschal

      Bushman, you keep reeling out this dumbshiet trying to sound like you are intelligent not knowing you are showing some kind of demented orientation and a morbid attraction to failure.

      • bush

        Don’t you know federal government has removed subsidy on Diesel, being a transporter, I am being deceived by GEJ

  • hummm

    Dont give us the highlight. Release the entire report for the public to read through and make their judgement. Right now, it is garbage in , garbage out.At the end of the day money is still missing in billion dollars.

    • MrFesh+Ifebuche+Paschal

      You couldn’t read the highlight but you want to read volumes of a report. Lazybone. So that you can begin throwing stuff out of context. It will still be made available anyway, to that tools like you will feast on delusions.

      • israel amulum

        Haha

  • Guguru

    When it is taking all this time to release a report of this significance, you have got to know that someone has something to hide. Otherwise, why are they releasing the report in bits and pieces at the convenience? There are damaging parts of the report which the Jonathan administration do not want us to see until after the elections. If Jonathan wins, then the report simply becomes another piece of paper that will gather dust because there is nothing we can do to him if he wins the elections. But if he releases the whole report now, the damaging part of the report could crash Jonathan’s chances of ever winning the elections. His chances are already very dim. But the report would simply turn his lights off.

    • amazing2012

      Jonathan requested for the audit report and ACfederation cannot release a report without president consent except if you are saying jonathan has no single control over those in government ! That means his removal is necessary !!!

    • israel amulum

      Talking bunkum

      • Guguru

        Proof?

  • Abija

    SANUSI LAMIDO SANUSI AS WE SEE HIM

    This government must not validate the growing perception that Sanusi Lamido’s suspension
    (from Central Bank) is to pave way for the covering up of tracks. In his public outbursts and
    on the NNPC’s funds, Sanusi Lamido had approbated and simultaneously reprobated
    to the extent that the primacy of his concerns and revelations were obviated by his flippancy.

    With his style and actions, there was no doubt that there had to be infractions
    on the normal run of the apex bank (CBN). The CBN must provide convincing
    answers to the queries from the Financial Reporting Council (FRC) and be
    subjected to further audit.

    With his petulance, foul temperament and imprudent conduct, Sanusi Lamido Sanusi
    impoverished the sobriety and dignity of the office of Governor of Central Bank
    of Nigeria in ways that made his appointment seem like an error in the first place”.

    ……The Guardian Editorial

    (March 5th, 2014)

  • Ping

    Nobody talking now. If the results says 20billion missing hell would have left loose. I know after schooling in sudan sanisu was up for something. Having stayed in the muslem country the greatest thing they fear is a christian (inferior religion as they used to call it in Saudi and Egypt) rulling them. We christians are little liberal on accepting muslem leadership for them. Is haram for an infidel to rule a muslem

  • Phillip Gokir Musa

    so I’m I to assume that a whole Nigerian ex-CBN governor (sanusi) was unable to accurately calculate? Wow!! What’s worse you ask? Well, they say he (sanusi) performed better than his predecessor (soludo). Nigeria was really bleeding under those guys. Thank you GEJ for the good riddance!

  • Dara Abimbade

    Agreed, Sanusi was not correct. The question we should be asking is: where is the $1.48billion? People, money is still missing. Can’t we all see that?

    • 247don007

      Not missing but wasn’t remitted. NNPC will remit same amount to the federation account.

      • Dara Abimbade

        I’m laughing in Greek..That money is gone and you know it. This is Nigeria, remember?

        • Original_Raskal

          is it today, you know they keep money for some 6 months fixed deposit for interest? all ministries do that…

          • Dara Abimbade

            We shall see

  • Adson

    Thanks AG and we have decided to accept the report as forwarded. One more thing please, who will go to prison for this meager amount we have been told was stolen?

    • Mike udi

      Not stolen but unremitted

  • Inah Etemfa

    Now that the “Report” is out…

  • utolason

    The report said. “Based on the information available to PwC and from the analysis above, the firm submitted that NNPC and NPDC should refund to the Federation Accounts a minimum of $1.48billion.”

    Mark the phrase “Based on information available to us”. Enough said!

  • Maitama Tambari.

    AGF, what are you saying? Sanusi claimed $67 billion while PwH found $69.39. Yes you are responsible to National Assembly, AGF, but your outing does not show that by comparing what Sanusi said and the forensic auditing found. How can we trust your interpretation of the Report, when you are making a comparison?

  • fresh15

    This is to tell you that most of all the criticisms against Jonathan’s administration are lies.Jonathan is has been working assiduously to move Nigeria forward.Let’s re-elect him.

  • Retired Colonel M.

    The independent audit report is now out.There was no mago mago involved in the transaction as detractors of this government would want you to believe. Can we now move on without this unnecessary distraction from a party that has absolutely nothing to offer the country?

  • Dr.Dan

    $1.48 billion at #205 exchange rate is about #303 billion which is greater than the sum of the monthly to the entire South West.