NNPC Now Recovering $9.6bn Owed Nigeria

The Nigerian National Petroleum Corporation (NNPC) has begun the process of recovering over seven billion dollars in over-deducted tax benefits from JV Partners on major capital projects and another 2.46 billion dollars from inflated contracts at NPDC.

This information is contained in a report submitted to President Muhammadu Buhari by the new management of the NNPC, detailing its successes so far.

In the document, the Group Managing Director (GMD) of the NNPC, Ibe Kachikwu, revealed that the corporation had commenced Performance Measurement & Bench-marking as well as Value for Money Review of NNPC and the JV Companies covering the period 2008 to 2013.

The report indicated that this process may lead to further cost recovery. According to the document, a reputable International Accounting Firm has been engaged by the NNPC to ascertain the exact amount due government on the Strategic Alliance Contracts entered by NPDC, where up to 2.46 billion dollars of government money is to be recovered.

It also revealed that consequent upon an extensive investigation of the various toxic crude oil for refined products swap contracts, a total sum of 420 million dollars has so far been reconciled in favour of NNPC and is now due for recovery from the legacy OPA/SWAP contracts.

Out of the reconciled amount, the sum of 277 million dollars has been recovered in lieu of products and the recovery effort is still ongoing, the document said.

“Significant cost reductions are also expected to ensure the Corporation remains profitable in the prevailing low crude oil price regime”.

According to the report, the GMD of NNPC is committed to continued review of all existing contracts and addressing the ones that are not favourable to the Corporation.

It added that progress was being made toward bringing back the nation’s refineries to full production, noting that “the management of the NNPC is working to ensure that this happens before the end of this year”.

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