The Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), on Tuesday said that payments into the JP Morgan account for crude oil and gas by the NNPC was being carried out in secrecy.
Mr Elias Mbam, the Chairman of RMFAC, stated this in Abuja at the ongoing investigative hearing on the NNPC’s N450 billion debt to the Federation Account.
The hearing was organised by the House of Representatives Joint Committee on Finance, Petroleum Resources (Upstream, Downstream) and Gas Resources.
Mbam said the account lacked supervision and monitoring by major stakeholders in the Federation Account Allocation Committee.
“The operations of NNPC’s domestic crude oil and gas account do not promote transparency and accountability.
“This situation makes the operation of the account subject of several criticisms, suspicion and lack of confidence by all stakeholders,’’ he said.
He said the indebtedness of the corporation to the Federation Account began in Nov. 2004 with the withholding of some portions of receipts due to it from crude oil sales.
Mbam suggested that NNPC should maintain a separate account for the domestic crude oil and gas to allow for effective monitoring of its operation and remittance into the account.
He noted that the issue of subsidy had been a recurring decimal which resulted in huge deductions of revenue due to the account by the NNPC.
Mbam also called for the appropriation of funds allocated for subsidy in order to ensure transparency.
“The Ministry of Petroleum Resources and the National Assembly should carry out extensive consultations and in depth study before determining the level of subsidy to be provided in the budget,’’ he added.
He said NNPC was to be paid N81 billion for subsidy between January and September but deducted N615 billion with a difference of N533 billion
The chairman accused the corporation of not remitting signature bonus, a premium from the concession granted on oil blocks into the account.
He further called for the passage of the Petroleum Industry Bill (PIB), addressing the Joint Venture (JV) partnership arrangements and other related issues plaguing the sector.
But responding, Mr Austin Oniwon, Group Managing Director (GMD) of the NNPC, said the corporation was paying the N450 billion under duress.
“It is under serious duress that we are paying, this is a forced payment,’’ he said.
Mr Funsho Kukpolokun, former GMD of NNPC, said unless the sector was deregulated and appropriate prices paid for petroleum products, it would remain static.
He said the corporation was not owing any sum, insisting that there was rather a funding gap that needed to be bridged.
The House, through a resolution, mandated the joint committee to investigate the NNPC over non-remittance of the amount to the Federation Account.