Audit unveils massive N515bn financial irregularities in NNPCL’s 2021 transactions
Nigeria’s Office of the Auditor-General for the Federation (OAuGF) has revealed significant financial discrepancies totaling N514 billion within the Nigerian National Petroleum Company Limited (NNPCL) for the 2021 financial year.
The audit report, which highlighted non-compliance and internal control weaknesses within various Ministries, Departments, and Agencies (MDAs), detailed these findings.
Among the irregularities noted were:
– Irregular deductions amounting to N343.64 billion from domestic crude sales at the source.
– The warehousing of N83.66 billion from the federation’s miscellaneous income into a sinking fund account.
– Unauthorized deductions of N82.95 billion from federation revenue designated for refinery rehabilitation.
– An unsubstantiated payment of N3.75 billion linked to the sale of petrol.
According to the OAuGF, these actions contravened the Constitution of the Federal Republic of Nigeria and the Financial Regulations Act of 2009.
The audit report specifically noted, “Audit observed from the review of NNPC SAP payment record for March and May 2021 payments that the sum of N484.73bn was the gross amount generated for the sale of domestic crude for the months of March and May 2021. The sum of N343.64bn from the gross amount was unilaterally deducted from the gross domestic crude sales as NNPC Value shortfall, Strategic Stock Holding Cost, Crude Oil and Products Pipeline Losses, as well as the pipelines maintenance and management costs.
“The details of each of the cost components deducted were not provided for audit review. Hence, the reasons for the deductions could not be justified by the management.
“In the month of May, the net payable that could have been remitted ought to have been N127.075bn, but only the sum of N77.075bn was remitted, leaving an unremitted balance of N50bn to the Federation Account, which has remained unaccounted for.
“The above anomalies could be attributed to weaknesses in the internal control system at NNPC, now NNPC Ltd. This is a potential loss of Federation revenue, diversion of public funds, or misapplication or misappropriation of funds.”
These financial infractions were identified before the rebranding of NNPC to NNPCL in July 2022, transforming its status into a commercial entity.
Subsequently, in 2024, NNPCL published its Audited Financial Statement for the 2023 financial year, reporting a net profit of N3.3 trillion, marking a significant financial turnaround since the company released its financial reports in 2020 for the first time in 43 years
