The Senate has uncovered an alleged fraud of N10 trillion by staff of Nigerian National Petroleum Corporation (NNPC) in connivance with officials of some independent marketers and other key players in the petroleum sector between 2006 and 2016.
Against this backdrop, the Senate joint Committees on Petroleum (upstream and downstream) and that of Gas will this week begin a probe of the affected companies, heads of government agencies and parastatals.
The committee also said it had the support of President Muhammadu Buhari and the Senate leadership to carry out a thorough and holistic investigation on the alleged fraud and bring to book the perpetrators, stressing that the amount involved was huge enough to finance the country’s budget for two consecutive years.
Addressing journalists, weekend, on the alleged scam, Senator Kabiru Marafa, Chairman, Senate Committee on Petroleum Downstream, who spoke for chairmen of the committees, said of the N10 trillion fraud, NNPC alone would account for N5.2 trillion it collected as subsidy from the Federal Government for importation of petroleum products, particularly Premium Motor Spirit, PMS, otherwise known as petrol between 2006 and 2016.
According to Senator Marafa, the NNPC will also account for the 445,000 barrels of crude oil allocated to it on yearly basis for local refining by the nation’s refineries.
Those fingered in the fraud by the Senate and already listed to appear before the committee during the planned public investigative hearing that will last a minimum of three days are past and present Chief Executive Officers of NNPC; Central Bank of Nigeria, CBN; Federal Inland Revenue Service, FIRS; Nigerian Customs Service; Nigerian Maritime Administration and Safety Agency, NIMASA; Nigerian Ports Authority, NPA and all Licensed Inspection Agencies.
Also to be invited by the committee are all bona fide end users, established and globally recognized large volume product trading companies; indigenous companies engaged in Nigeria oil and gas with trading of petroleum product expertise; product trading brokers; shipping companies and shops brokers, among others.
Gross under utilization of 445,000 barrels
Speaking further, Senator Marafa, who was flanked at the briefing by Chairman, Senate Committee on Petroleum (upstream), Senator Donald Tayo Alasoadura, APC, Ondo Central; Chairman, Senate Committee on Gas, Senator Bassey Albert Akpan, PDP, Akwa Ibom North-West; Senator Gershom Bassey, PDP, Cross River South and Philip Aduda, PDP, FCT, said available records before the committee showed that during the period under investigation, NNPC imported fuel into the country that was more than 40 per cent of the nation’s local consumption.
According to him, this is apart from gross under utilization of the 445,000 barrels it collected for local refining and consumption on yearly basis due to very low capacities of the four refineries in the country then.
Marafa said: “NNPC, being the custodian of crude oil resources of the nation, responsible for 51 per cent of petroleum products importation into the country over the years, aside the 445,000 crude allocation it gives itself on yearly basis for sales for local refining, must account for the N5.2 trillion which vailable records show that it has spent on subsidy on its own 51 per cent of petroleum products importation between 2006 and 2016.
“This is aside the N3.8 trillion spent on similar subsidy for independent marketers and about $1.5 billion yet to be accounted for by other key players in the industry.”
He disclosed that the committee had also discovered another dimension of fraud in the industry through the disappearance of PMS from storage leased by NNPC without any accountability and/or return of the value of the stolen product. According to him, there is a case of 100 million litres of PMS worth N14 billion stolen by two companies without any sanction against them by the NNPC.
Marafa threatened: “This committee has established the loss of 100million litres of PMS from such storage arrangement. We expected NNPC to have taken action against the two companies that carried out the theft but since it has not, we, hereby, order it to do so immediately, precisely within this week, failure of which we shall make the whole details known to the public.
“All key players in the sector along with their collaborators who have taken the country for a ride during the period under review, must be brought to book through exhaustive investigation to be conducted soon because President Muhammadu Buhari and the Senate leadership are very much interested in unmasking those behind the scam perpetrated during the Presidency of former Presidents Olusegun Obasajo, late Umaru Musa Yar’Adua, Goodluck Jonathan and by extension, the present Presidency.
“President Buhari is highly supportive of this move by the Senate and we shall not fail in carrying out the needed holistic investigation on obvious sharp practices in the sector. Needed documents for the onerous task are already in our possession.”
Marafa also disclosed that the whistle blower approach being adopted by the executive in unraveling such fraudulent practices of corrupt public officials, shall also be adopted in fishing out those involved in the oil sector massive fraud and the whistle-blowers will be compensated.
He also warned that strict sanctions awaited players in the sector who might want to frustrate the probe by deliberately refusing to honour invitation sent to them or conceal needed information.