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Published On: Wed, Dec 6th, 2017

Revenue Leakages: Rep directs NPDC to Pay DPR $1.5bn royalty debt in 3 Years

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By Umar Muhammad Puma

The House of Representatives Adhoc Committee investigating over N1.6trillion revenue leakages has demanded that the Nigerian National Petroleum Corporation (NNPC), and Nigeria Petroleum Development Company (NPDC), to pay accumulative $1.5 billion unpaid royalties on oil and gas activities of the company.
Chairman of the ad-hoc committee, Rep Jarigbe Agom Jarigbe (PDP, Cross River), disagreed with a payment plan of $10million monthly instalment, agreed between the company and the DPR, asking what happened to the money over the years leading to the accumulated outstanding?
Responding to the queries, the Chief Operating Officer (COO) Upstream of the NNPC, Bello Rabiu told the panel that, though, the NNPC set up the company, the NPDC is hundred percent an independent entity, adding that the royalties being owed was not the making of the current management of both entities.
On his part, the managing director of NPDC, Yusuf Matashi said the royalty debts piled up due to the failure of the company’s strategic partner, Atlantic Energy to pay its liability.
He said Atlantic Energy, owned by Jide Omokore “is fond of presenting different companies which has made it difficult for NPDC to extract compliance on contract agreements, disclosing that the case is in court and would be subjudice for it to be treated in public.
The panel members who insisted NPDC look for the money by whatever means to pay DPR outrightly disagreed with his submission.
They expressed disappointment in the behaviour of NPDC as a government entity which starves government of needed funds in an economy that just experienced recession, and a budget deficit of over N2trillion that would be financed by borrowed funds.
They wondered why such money should be kept away when more than half of government’s earning will go into debt servicing due to excessive borrowing to finance to budget.
The panel informed the organisation’s that a technical committee would be set up to handle all areas of differences as a last resort toward addressing the problem.
The panel also engaged chief executive officers of international oil companies (IOCs) who took turn to give updates on their interface with the DPR with a view to reconciling differences on royalt payment.
Present at the hearing were CEOs of: Shell, Osagie Okunbor, that of Nigerian Agip Oil Company (NOAC), Massimo Wsulla, Paul McUrath, MD of Exxon Mobil, Nicholas Terrag, MD of Total and Jeff Ewig, the MD of Chevron Nigeria.
Having pointed out areas needing further reconciliation, the committee chairman stated that the IOCs be part of the technical committee to meet in Lagos next week for final reconciliation.

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