$1.05bn NLNG dividend: Stakeholders confirm NNPC’s powers to withdraw

Stakeholders in the oil and gas industry have confirmed that the Nigerian National Petroleum Corporation (NNPC) has the powers to withdraw from its share of Nigeria Liquefied Natural Gas (NLNG) dividend.

Speaking on Wednesday with TribuneOnline on whether the NNPC has the powers to spend NLNG dividend without approval by the National Assembly, an Oil and Gas Lawyer, Barrister Eniola Ogundele, argued that the NNPC, as a shareholder in NLNG has the right to spend such money without approval.

According to him, “NNPC Act makes the corporation an entity that can enter into agreement, signs and execute contracts. Section 7 of the Act clearly confers such powers in NNPC without any ambiguity.

“Section 7, (1) of the NNPC Act 1977 provides that: The corporation shall keep proper accounts and proper records in relation thereto in a form which shall conform with the best commercial standards.

“Section 4 however states that: The corporation shall maintain a fund which shall consist of (a) such monies as may from time to time be provided by the Federal Government for the purposes of this Act by way of grants or loans or otherwise howsoever; and (b) such moneys as may be received by the corporation in the course of its operations or in relation to the exercise by the corporation of any of its functions under this Act, and from such fund there shall be defrayed all expenses incurred by the corporation.

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“As you may see from the Act, NNPC has the powers to receive such monies in the course of its operations and such fund shall be defrayed all expenses incurred by the corporation.”

He argued further that due to the nature of NNPC, “the corporation may not be regarded as a Ministry or Departmental Agency that must submit its budget to the National Assembly. For instance, the Joint Venture operations require part funding by the NNPC through cash call obligation.

“The fund that may be required to fulfill 2018 obligations may not be the same for 2019 obligations. The question is how often does the NNPC need to visit the National Assembly for approval of every spending? Those that made the NNPC Act made it in anticipation of such legal encumbrances and save the NNPC from such bureaucracies.”

In his reaction, a member of National Union of Petroleum and Natural Gas workers (NUPENG), Comrade Jerome Albert, argued that NNPC has been spending such fund considering its critical role in fuel importation and stability in fuel distribution.

He said efforts should be made to ensure transparency in such spending, “which is more critical that questioning the powers to spend such money.

“In my opinion, what we should be asking is that has NNPC mismanaged such fund? If yes, the Senate should investigate. But so far, the issue of mismanagement has not been established.”