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NNPC Explains Under-payments Of OMLs 67, 68, 70 Lease Renewals

NNPC GMD, Mallam Mele Kyari, in a discussion with the Chairman of the Special Presidential Investigative Panel for the Recovery of Public Property, Chief Okoi Obono-Obla, during a fact-finding visit to the NNPC Towers on Monday

The Nigerian National Petroleum Corporation (NNPC) has explained the alleged financial breaches in its operations by the Special Presidential Investigative Panel for the Recovery of Public Property.

Speaking while receiving the Chairman and members of the Panel at the NNPC Towers on Monday, Group Managing Director of the Corporation, Mr Mele Kyari, said the NNPC has nothing to hide regarding it’s operations.

Asked about the alleged underpayment of lease renewal fees on Oil Mining Leases (OMLs) 67, 68, and 70 by ExxonMobil, Kyari explained that the company paid $600m which was their equity contribution of 40percent of the Joint Venture agreement after which NNPC was to pay the remaining 60percent.
He however,  stated that it became unnecessary for the NNPC to make the payment as the corporation represented the government.
“Ordinarily, NNPC would have contributed the balance of 60percent of the amount which literally meant government paying monies to itself. There was no need for that,” Mr Kyari explained.

On the alleged breach of government’s Treasury Single Account (TSA) policy, the GMD said the NNPC has no secret account, emphasizing that there is no account operated by the NNPC that is unknown to the Federal Government. “Any account(s) outside the TSA platform are partner accounts (for) which we have obtained due approvals from the government,’’ he noted.

While observing that all monies belonging to the corporation were domiciled with the Central Bank of Nigeria (CBN), Kyari added that the Corporation’s account managers remain the CBN and the Accountant General of the Federation.

Also clarifying issues on the alleged non-remittances of taxes and royalties by the Nigerian Petroleum Development Company (NPDC), NNPC’s upstream arm, Kyari said there were outstanding payments which arose as a result of the pillage that occurred before 2015.

He, however, assured the Panel that this administration has made concerted efforts to reconcile every payment due to the Federation on taxes and royalties. “The only outstanding payment is the $600m and we have a pre-payment plan with the Department of Petroleum Resources (DPR) such that by mid-2020, we will have money left to be paid,” he said.

Also on the alleged non-remittances by some oil companies operating in the country, the NNPC boss stated that it was the responsibility of the Federal Inland Revenue Service (FIRS) and the DPR to collect taxes and royalties from oil companies, including those on Joint Venture (JV) and Production Sharing Contract (PSC) arrangement.

He noted however, that the NNPC would provide the necessary support to the agencies concerned in that regard, even though it has no legal obligation to do so.

While affirming the Corporation’s commitment to transparency and accountability, Kyari said by publishing it’s monthly operational reports, the Corporation is one of the most accountable public institutions in the country.

Earlier in his remarks, the Chairman of the Presidential Panel, Chief Okoi Obono-Obla said their visit was to seek synergy with the NNPC towards reforming the country and particularly to get explanations on issues relating to the operations of the Corporation.

“Nigerians have been misled, it behoves on every organization to tell Nigerians the truth to engender transparency in the entire polity,” he said.

 

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