The House of Representatives on Wednesday resolved to investigate the Nigerian National Petroleum Company Limited (NNPCL) over an alleged loss of an estimated $60bn to inflated Cash Calls.
To this end, the House mandated its Committee on Finance to conduct a comprehensive investigation on all the NNPCL Joint Venture Operations to determine income and Cash Call costs due to each partner, especially the Federation/ Federal Government of Nigeria and whether due process and diligence were observed in the exercise.
The resolution of the House followed the unanimous passage of a motion titled, ‘Need To Investigate the Loss Of Revenue Of Over $60,000,000,000 (sixty billion Dollars) Only Due To Inflated Cash Calls By the Nigerian National Petroleum Company Limited Joint Venture Agreements’, sponsored by Rep. Chike Okafor.
Leading the debate on the motion, Okafor, who chairs the House Committee on Nutrition and Food Security reminded the House that the Nigeria National Petroleum Company Limited (NNPCL) on behalf of the Federal Government operates Joint Ventures and related agreements with Private Oil Companies in the Oil and Gas sectors, with the aim of sustainable revenue generation and economic development;
He highlighted the fact that the NNPCL, as representatives of the Federal Government and Federation have about 60% holding while other partners have the remaining 40%.
This is even as the joint ventures operate under a “Joint Operating Agreement” that spells out the responsibilities of each of the partners in the ventures.
The lawmaker however expressed concern that years of bloated cash call costs, has led to the NNPCL Upstream Investment Management Services (NUIMS); a unit under the NNPCL in charge of negotiation of costs (both Capex and Opex) incurring losses in the neighbourhood of $60,000,000,000.
He said that “the activities of NUIMS have resulted in huge revenue losses, fiscal deficits and an alarming debt profile.
“There is a need to ensure probity, transparency and value for money in the NNPCL Joint Venture operations”.When Deputy Speaker Rep. Benjamin Kalu who presided over plenary called for a voice vote it was passed without dissent and referred to the Finance Committee.
