Missing Petrol: After PREMIUM TIMES report, NNPC moves to recover N11 billion from Capital Oil

Capital oil

The Nigerian National Petroleum Corporation, NNPC, said on Friday it was fully committed to implementing various measures it considered necessary to achieve full recovery of its missing petroleum products stored in the facilities of two indigenous downstream operators in Lagos.

PREMIUM TIMES had exclusively reported on Thursday on the missing 130 million litres of premium motor spirit, PMS, popularly called petrol, owned by the NNPC Retail, a downstream subsidiary of the NNPC, stored in the products depots belonging to Capital Oil & Gas and MRS Petroleum.

The products stored in the two private facilities under a throughput arrangement to build a robust strategic national reserve got missing in controversial circumstances.

Under the terms of the throughput arrangement, The NNPC Retail paid N2 for every litre of petrol stored in a private depot.

Consequently, N200 million was paid to Capital Oil and N60 million paid to MRS for 100 million and 30 million litres of petrol stored in the two facilities.

NNPC Chief Operating Officer, Downstream, Henry Ikem-Obi, said in Abuja that part of the measures considered to facilitate the recovery of the products included its decision to alert the State Security Service, SSS, and the Economic Financial Crimes Commission, EFCC.

Mr. Ikem-Obih said the corporation had also reported to the relevant committees of the National Assembly with oversight functions on the corporation’s downstream operations, to help recover the asset contrary to the insinuation that NNPC kept mute over the infraction until the Senate uncovered it.

He said so far, MRS petroleum had fully complied by returning the 30 million litres of petrol used illegal without NNPC’s permission.

The COO said the NNPC was not making much progress in relation with Capital Oil & Gas, which was yet to return about 82 million litres of petrol, valued at N11billion, out of over 100 million litres kept in its facility.

He further disclosed that NNPC had set up two committees to evaluate the roles played by some of its staff in the illegal product evacuation and review its entire throughput policy in order to align it with global best practices.

Mr. Ikem-Obi said the infraction was discovered earlier in January when the NNPC needed to access the over 100 million litres of petrol stored at the Capital Oil & Gas depot for NNPC Retail and just over 30 million litres in MRS Limited depot, all in Apapa area of Lagos.

“We instructed the Nigerian Products Marketing Company (NPMC) a subsidiary of NNPC, to send additional trucks to those locations to move products for distribution aimed at meeting a supply shortfall we discovered in the market.

“But after days of not being able to access the terminals, we had to take a decision as NNPC Management to invite auditors and inspectors to go and do a physical check on the inventories The visit revealed that there was no molecule of product for the NNPC to evacuate,” he said.

The COO said the infraction by the two downstream companies was a clear violation of existing throughput contract, which prohibited owners of the facilities from tempering with the volumes in their custody without express permission of the NNPC

Armed with the findings, he said the NNPC invited the two companies to explain what happened to products in their custody.

Letters were later issued to the companies to either return the full volume of what was stored in their depots, or pay the full value of the products they took without NNPC’s approval.

CAPITAL OIL REACTS

In its reaction, the management of Capital Oil & Gas Limited said on Friday it had written to the NNPC to demand the full reconciliation of accounts for debts owed the company over the last two years.

The Chairman of Capital Oil, Ifeanyi Uba, told PREMIUM TIMES on Friday that his firm had been writing to NNPC on several occasions in the past to get its management to agree to sit and reconcile the accounts on various petroleum products supply transactions.

“NNPC has been owing us (Capital Oil) on petroleum products supplies over the last two years. We have written several letter to them calling for reconciliation without success. We have written to them calling for total reconciliation of accounts, and they have agreed,” Mr. Uba said in a telephone chat on Friday.

Although Mr. Uba did not say how much the NNPC was owing Capital Oil, he said that would be determined at the end of the reconciliation exercise.

To forestall a repeat of similar occurrence in the future, the COO NNPC Downstream said a disciplinary committee was constituted to investigate the level of involvement of its staff with a view to applying appropriate sanctions as a deterrence measure.

The second committee, he said, was reviewing the Corporation’s policy and guidelines for engaging in throughput arrangements with third parties to establish control measures to help avert a similar incident in the future.

On possible punitive measures to be meted out to culpable staff and erring firms, the COO said it would be better to allow the committees decide that in line with existing laws and regulations.

On the impact of the product diversion on the supply system, he said there was no fear of under-supply as the Group Managing Director of NNPC, Maikanti Baru, has approved an increase in importation of petrol to make up for the shortfall.


NEVER MISS A THING AGAIN! Subscribe to our newsletter

* indicates required

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: To place a text-based advert here. Call Willie - +2347088095401


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.