THE All Progressives Congress (APC) on Tuesday disclosed that alleged underhand oil contracts to the tune of N9 trillion at the Nigerian National Petroleum Corporation (NNPC) had been overtaken by the event.
The acting National Publicity Secretary of APC, Mr Yekini Nabena in a statement entitled “PDP Allegations on NNPC Operations: The Facts” was reacting to the Peoples Democratic Party (PDP) call for the APC to come clean on the alleged underhand dealing at the NNPC.
The party, however, maintained that “going by the current oil sector reforms, it is clear that the President Muhammadu Buhari administration has not copied the corrupt template past PDP-led administrations used to criminally syphon oil revenues.
“The oil sector reforms have provided government more revenue to address social and infrastructural needs of the country; is curbing the perennial fuel scarcities; increased private sector participation and resulted in remarkable investments in both Refineries and Retails. The country is now poised to achieve self-sufficiency in terms of refining petroleum”, the party stated.
On the leaked memo detailing alleged underhand oil contracts to the tune of N9 trillion at the NNPC and the Ministry of Petroleum Resources, the party said, “the subject of a leaked memo purportedly written by the Minister of State for Petroleum Resources to the President which came to the fore sometime in October 2017 has since been overtaken by events.
“It is a matter of public knowledge that the author of the memo openly proclaimed that the issues raised in the letter were not on fraud but on governance and suggestions on ways to go about it”, the party stated.
The statement read: “Secondly, it was clearly stated that by the NNPC in response to the leaked document that apart from the 618km Ajaokuta-Kaduna-Kano (AKK) gas pipeline project and the Nigerian Petroleum Development Corporation (NPDC) production service contracts:
“All the other transactions mentioned in the memo were not procurement contracts. The NPDC production service contracts have undergone the due process, while the AKK contract had not reached the stage of contract award”.
“Similarly, the NNPC also stated then that: “It should be noted that for both the Crude Term Contract and the Direct Sale and Direct Purchase (DSDP) agreements, there are no specific values attached to each transaction to warrant the values of $10billion and $5billion respectively placed on them in the leaked document”.
“Thus it was inappropriate to attach arbitrary values to the shortlists with the aim of classifying the transactions as contracts. They are merely the shortlisting of prospective off-takers of crude oil and suppliers of petroleum products under agreed terms.
“Alleged Diversion of Crude oil worth N1.1tr, using 18 unregistered companies
“It also in the public domain that within the last three years, there have been massive and verifiable reforms in the sales, marketing and general management of the various grades of Nigeria’s equity crude oil.
“The reforms have manifested in the now popular public opening of bids for the sales and purchase of Nigerian crude grades in what is known as annual crude term contract.
“As at last check, the Crude Oil Marketing Division (COMD) of the NNPC had achieved 98 per cent automation of all transactions involving the supply, marketing and sale of the various grades and blends of Nigeria’s crude oil across the world.
“The automation has also helped in the following: enabled the open bid process of customer selection for lifting and purchase of Nigeria’s crude oil grades, emplacement of efficient crude for product import processes, leading to savings of $1 billion in one year as well as the introduction of improved pricing system, which has evolved into a robust and auditable pricing mechanism.
“Based on what we have today, the NNPC COMD is enabled to achieve an end-to-end monitoring of every barrel of crude oil sold in the country. At a click of a button, the NNPC can tell you how much crude oil is sold, at what price, who bought it and where it has gone to etc.
“It is therefore inconceivable that the PDP or anybody could ascribe such patently bogus transaction to NNPC.
“Alleged billions of unremitted revenue from the sale of crude for which there has been a deadlock at the Federal Accounts Allocation Committee (FAAC).
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“With regards to the above which was largely triggered by the contentious June 2018 monthly Federation Account Allocation Committee (FAAC) meeting, it is imperative to state as follows:
“The current NNPC Management assumed office a few years ago with a clear mandate to promote accountability and ensure efficiency in the running of the affairs of the Corporation. The remittances to the Federation Account have never been flat as asserted.
“While the provision of the Medium Term Expenditure Framework (MTEF) was based on plans on the assumption of 2.3 million barrels/day (industry wide) and $50 crude oil price, actual production has averaged 1.9 million barrels/day (industry wide) and the average crude oil price has fluctuated between $50-$70.Therefore remittances to the Federation have been based on actual monthly performance for crude oil production and price as dictated by international market forces.
“The Corporation during the FAAC meeting presents relevant data to support amounts remitted to the Federation Account which is verifiable. This increase in price was the major reason for NNPC remittance to the Federation Account in June 2018 despite 400,000 barrels/day below projected production for the month”, the statement concluded.
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