The Nation Newspaper

Tag: NNPC

  • Reps move to bar NNPC from obtaining loans

    Reps move to bar NNPC from obtaining loans

    Members of the House of Representatives will commence debate on a bill which seeks to bar Nigerian National Petroleum Corporation (NNPC) from obtaining loan without the approval of the National Assembly.

    The bill sponsored by Raphael Igbokwe is titled: “The bill for an Act to amend the NNPC Act to ensure approval of the National Assembly is sought before any loan is obtained.”

    The bill is slated for second reading on the floor after the House resumes from the Eid- el- Kabir break.

    The bill seeks to amend NNPC Act, Cap. 123LFN 2004 by adding a new sub-section (6) which provides that: “The President shall cause the estimate submitted in pursuance of section (5) of this section, to be attached as part of the Appropriation bill to be submitted to the National Assembly.”

    It also seeks to amend Section 8 by adding the phrase “provided the aggregate of such loans do not exceed the limit as approved by the National Assembly.”

    According to Igbokwe, “the bill seeks to enhance financial and fiscal discipline by ensuring that all loans are approved by the National Assembly before they are secured.”

  • States demand account of subsidy since 2007

    States demand account of subsidy since 2007

    Governors have demanded from the Federal Government details of the money withdrawn from the country’s revenue for fuel subsidy since 2007.

    They are also insisting that it is wrong of the Federal Government to deduct funds for fuel subsidy and other related expenses from crude oil proceeds before payment into the Federation Account.

    Expressing doubts about the Federal Government’s transparency in the handling of the proceeds from crude sales, the governors have urged the Supreme Court to stop the deduction of money before payment into the Federation Account.

    The 36 states’ case was initially filed before the apex court in 2012.

    Parties in the suit, including Joseph Daudu (SAN) and Lateef Fagbemi (SAN), on September 23 regularised their processes. The Supreme Court fixed December 8 for the hearing.

    The states, in a suit by their Attorneys General, described as “unwholesome and unconstitutional” the practice of deducting “fuel subsidy funds and other expenditure from oil proceeds before it is paid into the Federation Account”.

    They contended that the practice by the Federal Government, through the Nigerian National Petroleum Corporation (NNPC), formed one of the measures through which the Federal Government shortchanges the states and local governments.

    The states claim that the practice has caused inaccuracies in the computation of oil revenue remitted to the Federation Account by the Federal Government and its agencies. They urged the apex court to abolish the practice.

    In their statement of claim, they stated that “there are inaccuracies in the crude oil and gas revenues remitted to the Federation Account by the NNPC, caused by wrongful deductions at source by the NNPC to fund her operations.

    “As a matter of practice, subsidy claims ought to be remitted to the NNPC from the Petroleum Support Fund by the Federal Ministry of Finance, based on claims from oil marketers approved by the PPPRA.

    “However, NNPC’s practice is to remit to the Federation Account, amount payable for domestic crude, less subsidy claim. The NNPC then requests the Federal Ministry of Finance to pay the amounts due to subsidy claim back into the Federation Account, being the balance cost of the domestic crude.

    “According to a report of the Federal Ministry of Finance dated November 22, 2010, titled, ‘The Interim Report on the Process of Forensic Review of NNPC’ the implication of this unconstitutional practice is that the actual remittance of proceeds for domestic crude sales to the Federation Account is far less than the amount expected.”

    The states are praying the court to, among others, declare the Federal Government’s practice as a violation of the provisions of sections 88 and 162 of the Constitution.

    They also seek an order of perpetual injunction retraining the Federal Government, its agents and those taking instructions from it “from making any further deductions from the amount standing to the credit of the Federation Account for the purpose of funding the payment of fuel subsidy claims or any other purpose whatsoever, except those authorized by section 162 of the 1999 Constitution of the Federal Republic”.

    They are also praying for an order directing the Attorney-General of the Federation (AGF) to, on behalf of the Federal Government, “give account of all subsidy claim deducted from the federation account from 2007 till date”.

    Named as defendants in the suit are the Attorney General of the Federation (AGF) and Minister of Justice and the National Assembly.

    In their notices of preliminary objection, the respondents challenged the jurisdictional competence of the Supreme Court to hear the case.

    They contended that the appropriate court to institute the suit was the Federal High Court because the plaintiffs were challenging the deductions made by the NNPC, which is a federal agency.

    They also argued that the case was statute barred on the grounds that the suit, filed in 2012, sought to challenge the deductions made from 2007.

    The respondents further argued that the plaintiffs’ claims did not disclose any cause of action against them.

  • ‘Report on missing NNPC $10.8b ready soon’

    ‘Report on missing NNPC $10.8b ready soon’

    The last may not have been heard of the Audit report on the $10.8bn alleged to be missing from the coffers of the Nigerian National Petroleum Corporation (NNPC).

    Minister of Finance Dr. Ngozi Okonjo-Iweala said yesterday in London that the report will be ready next month.

    She spoke at the Financial Times Africa Summit 2014, adding that the audit report was commissioned because of the need for transparency and the interest generated on the matter.

    ”Initially it was $48bn, then $20bn; but the figure we have always had is $10.8bn. I am Minister of Finance; if money is missing I want it – to use it for good things for the country and that was why when we went to the Senate, we demanded for forensic audit. The president supported it and asked for it to be done.

    “We engaged PwC, with the Auditor General taking the lead. They asked for 16 weeks to complete the work; they have spent 11 or 12 weeks so far and they will be done in a couple of weeks.”

    Director General of Securities and Exchange Commission (SEC) Ms Arunma Oteh said Nigeria had been focusing on Small and Medium Enterprises development as a way of creating more jobs and improving the standards of living.

    She said: “I think first and foremost is the recognition globally about the importance of SMEs because they are the ones that create jobs. I think there is a greater focus on how SMEs can be supported.

    “In our own country, President Goodluck Jonathan recently set up an SME council. He sets up a job board; all of that is focused on how we can practically address the challenges we are facing with SMEs.

    ”We need to provide funding at reasonable cost; capital that is patient so that people can grow their businesses and banking finance is not patient. What we need is capital that would be there for a long time; a market-based finance that is long term and there is a global recognition of this fact.

    “Housing is big and government is definitely focusing on it. This is because apart from providing housing for Nigerians to bridge the housing deficit; the sector is also capable of providing the much-needed jobs to move the economy forward.”

    On successful containment of the Ebola Virus Disease (EVD) the finance minister said Nigeria needed to be commended for the efforts it made in ensuring the index case did not take the illness out of the country and the manner it was also contained.

    “Nigeria did a great service by stopping Sawyer who was Minnesota-bound. Ebola cannot be said to be the real elephant in the room as it has been hyped beyond proportion by the media.

    “We all want democracy, but how do you get it? It involves money. If you want accountability and good governance you must discuss issues relating to campaign funds. People who sponsor campaigns believe they must get something from the government when elections are won. These are the real elephants in the room and we need to deal with it” Okonjo-Iweala added.

     

  • Motorists accuse fuel attendants of fraud

    Motorists accuse fuel attendants of fraud

    • DPR: we’ve received several complaints

    Motorists are protesting what they called sharp practices by attendants at filling stations. Many filling stations use under-dispensing fuel pumps that do not record accurate sales information.

    The  Department of Petroleum Resources (DPR) said it had received complaints from many motorists.

    The Nation gathered that many of the fuel pumps do not present accurate readings, making it easier for petrol stations to short change their customers.  A visit to some petrol stations in Iyana- Ipaja, Ikotun, Ikeja, Oshodi, Ketu, Ikorodu and Ebute-Metta in the Lagos metropolis gave confirmed this assertion.  It was further gathered that the distortions of the readings of the meters were mostly done by petrol attendants, albeit with instructions from their managers.

    A petrol station manager, who does not want his name in print, said that the issue is disturbing because customers have lost confidence in the filling stations that commit such crimes.The sources said the perpetrators operate like a chain, adding that many people were involved in the issue.

    “From my experience in the industry, I know that a lot of workers were used to short-change customers.  There is a top-down approach to the issue. Senior and junior members of staff in the petrol stations are involved in the crime. It is wrong to conclude that only the junior workers short-change customers.  No petrol attendant has the courage to open meters and adjust them without the express permission of his or her manager.  People who perpetrate such evils make a lot of money. Many petrol attendants have two cars or more. The question is: Where did they get the money to buy those cars?” The source asked how many attendants earn N20,000 monthly?  The older ones do not collect more than N13,000 per month, he said.

    A lawyer, Ponle Olurotimi, said many people have fallen victims to this sharp practice at fuel stations. Olurotimi said she has been inundated with reports of people that were duped by filling stations. I have heard motorists, housewives, and other users of petroleum products complain about the issue, she said.

    She said: “The issue of short-changing customers cuts across the three petroleum products namely diesel, kerosene and petrol.  The transporters, women and other household users of petroleum products have been cheated in the past.  For instance, many have said that they got 15 litres of petrol, instead of 20 litres they paid for.”

    An Executive Director, African Centre for Media and Information Literacy, Lewis Asubiojo, said some petrol stations in Abuja are fond of under-dispensing products to customers. Asubiojo said he has once reported a petrol attendant to his station manager for not dispensing the right volume to him.

    He said: “I have been short-changed by filling stations owned by independent oil marketing companies. Many of my friends said they do not want to fall victims again, and have resorted to buying fuels from petrol stations that belong to major marketers and the Nigerian National Petroleum Corporation (NNPC) to ensure accurate volume delivery. The NNPC and major marketers have something at stake. They invest billions of naira into the business and would not do anything that will tarnish their reputations.”

    However, the Director, Department of Petroleum Resources (DPR), George Osahon, said the agency will move against any petrol station found short-changing its customer. Osahon said the DPR has received complaints on the issue via short messages and e-mails. He said that DPR is ready to act on useful information that can lead to discovery of filling stations engaging in such practices.

    “DPR has received several complaints on the issue of retail outlets under-dispensing products to their customers.  Just as it is not possible for the police to be everywhere at the same time, so it is with officials of DPR. We have told the public to come out with information on any station short-changing its customers for necessary action,” he added.

  • NNPC to track down writers of fake letters

    The management of the Nigerian National Petroleum Corporation (NNPC) cried out yesterday on the circulation of fake letters of authorisation, purportedly from the corporation, to buy and/or sell crude oil.

    It vowed to, in collaboration with security agencies, track down the perpetrators and bring them to book.

    NNPC Group General Manager, Group Public Affairs Division, Mr. Ohi Alegbe, who spoke in a statement, urged the public to be wary of persons with fraudulent intents, circulating letters authorising the lifting of Bonny Light crude oil from Nigeria.

    A paragraph in one of the fake letters reads:

    “We hereby confirm that the Nigerian National Petroleum Corporation (NNPC) has entered into contractual arrangements with Lavi International Corp to supply Bonny Light Crude Oil to the Lavi International Corp Associated Refineries and or Global Traders, and that Lavi International Corp has the power and authority to sell or otherwise deal with the Bonny Light Crude Oil, the subject of those contractual agreements.”

    NNPC said Messrs Lavi International Corp is not one of its crude oil off-takers for the 2014-2015 Term Contract Period and therefore has not been allocated any crude oil volume as speculated in the fake letter of authorisation.

    It noted that the list of local and international companies approved as NNPC’s crude oil off-takers for the 2014-2015 Term Contract Period has been publicised and enjoined the public to avail themselves of such information to avoid being duped by unscrupulous elements.

    “We are working with the relevant security agencies to bring to book those behind these nefarious activities,” management said.

  • N133.5b pension gap unsettles NNPC

    N133.5b pension gap unsettles NNPC

    The Federal Government’s hammer may soon come down hard on the board and management of the Nigerian National Petroleum Corporation (NNPC) over their shoddy handling of its N133.56 billion pension liabilities.

    The Nation gathered that the industrial action embarked upon last week by petroleum industry workers caught the government unawares.

    The issue of NNPC’s pension liability, it was learnt, had been a recurring decimal in the last 14 years. At the peak of the privatisation during the Obasanjo government, The Nation learnt that the Bureau of Public Enterprises (BPE) had raised serious concerns over NNPC’s pension gap.

    To solve this problem, a source in the Presidency disclosed that “during the early years of privatisation, there was a meeting between NNPC and BPE where the issue of pension gap was discussed and it was agreed that some non-core assets should be sold”.

    The source, who is conversant with the issue, said: “Stallion House, Lagos and other non-core assets were sold to fund NNPC’s Pension deficit, yet nothing was done to fund the pension gap.”

    The source said the management of NNPC was warned then of the looming danger in not funding the pension assets of its workers. But NNPC officials gave the excuse that the corporation’s remittances to state coffers handicapped it from funding the pension gap.

    The Presidency official disclosed that a memo detailing the genesis and the actions taken in the past to address NNPC’s massive pension gap had been forwarded to President Goodluck Jonathan.

    The National Pension Commission (PENCOM) has revoked the licence granted to the NNPC Pension Fund over failure to meet its requirements. The letter conveying the revocation notice by PENCOM dated September 8, this year, addressed to the Group Managing Director, NNPC, and signed by the Acting Director-General, PENCOM, Chinelo Anohu-Amazu, said the commission had come to the conclusion over the unwillingness of NNPC to comply with the provisions of the Pension Reform Act (PRA) 2014 and the conditions attached to the approval granted it to continue with the scheme.

    In 2006, PENCOM gave temporary nod for NNPC Pension Fund to operate as a Close Pension Fund Administrator (CPFA), pending compliance of guidelines by the commission and the provision of the PRA. But of the five provisions, NNPC could not meet any.

    PENCOM reminded NNPC that Section 50 (1) (g) of the PRA, 2014 and clause b) (i) of the approval conditions provides that the scheme should be funded and that any shortfall should be made up within 90 days.

    The letter said: “NNPC has breached this condition considering that the scheme has remained in deficit since inception in 2006. NNPC made an undertaking to transfer additional assets to address the deficit. Despite several commitments, NNPC has failed to provide the additional assets.”

    The PENCOM letter stated that “as at December 31, 2012, the deficit in the scheme was N133.56 billion (inclusive of the N182.26 billion receivable from NNPC). The commission is concerned that eight years after the grant of approval to continue with the existing scheme, NNPC has failed to honour its promises to fund the deficit despite several commitments.”

    The PENCOM letter also stated: “Clause b) (ii) of the approval conditions provides that the funds and assets of the scheme shall be passed to licensed Pension Fund Administrator(s) of NNPC’s choice for management. But NNPC is in violation of this condition and section of the PRA 2014 by failing to transfer all funds and assets to licensed Pension Fund Administrators for management…’’

  • NNPC tackles Brass’, OKLNG’s problems, others

    NNPC tackles Brass’, OKLNG’s problems, others

    The Nigerian National Petroleum Corporation (NNPC) is finding  solutions to the troubled multi-billion dollar Olokola Liquefied Natural Gas (OKLNG), Brass LNG, and  expediting action on the building of the NLNG Train 7 plant, which has been on the cards for years.

    The construction of OKLNG suffered a setback when three major shareholders in the project pulled out. The project was conceived in 2007 by NNPC, British Gas (BG), Chevron and Shell.  BG and Shell withdrew from the project in June 2012 and July, last year while Chevron withdrew in August, last year. With the withdrawal of these international oil companies (IOCs), NNPC is the  only  shareholder left  in the project.

    In 2012, ConocoPhillips, a major shareholder in Brass LNG, withdrew from the project and ever since, no significant progress has been made in the project. The Nigeria LNG Train 7 project has been on the table for a couple of years and yet the final investment decision (FID) is to be taken.

    The Group Executive Director, Gas and Power, NNPC, Dr David Ige, said the corporation was back to the table to see how it could bring these projects on course.

    He said this was line with the government’s policy and strategy to create value in the gas sector and keep Nigeria’s share of global LNG market at 10 per cent.

    Ige told The Nation, that the discussions were initiated to address problems, such as investments, regulatory and community issues, among others, facing the projects.

    He said the projects were critical to the growth of the domestic and international gas market, hence the decisions to address the problems. “We have concluded the exit of ConocoPhillps from Brass LNG. We have seen the exit of Chevron and Shell from Olokola Liquefied Natural Gas. We are back on the table to address all the problems hindering OKNLG, Brass LNG and Train 7 projects. On Train 7, stakeholders are working to move the project to the next stage.  We are back on the table to identify the potentials in the three projects, and galvanise them for economic growth,” he said.

    He also said the discussion would determine the government’s next  action, adding that the projects are of great importance to the economy.

    The General Manager, Development, Shell Petroleum Development Company (SPDC), Bayo Ojulari, said: “We don’t have fiscal terms for deepwater gas. A country as big as this with all the resources, we don’t have a term for deepwater gas, which means that deepwater gas is being stifled because the policy we need to put in place to allow people to participate has not been provided.”

    Earlier, NNPC’s Group Managing Director, Joseph Thlama Dawha, said the development of the huge gas resources in the country’s offshore would help in fostering the energy sector’s growth.

    “We are working on an integrated approach to ensure that much of the gas being found in deep offshore is made available for LNG projects, among others, so that the three LNG projects  will be fed from that opportunity.

    ‘’We are working on a master plan to do this and we have commissioned consultants to look at that. Thirdly, we are committed to making sure that gas is available and affordable domestically.

    “We have a necessity to ensure that all of these projects go ahead. That is a necessity mandated by the law. Whether it is Train 7 or Brass or OK LNG, we are consistently putting those projects forward because strategically, our policy towards LNG is to keep our market share up. So, strategically we are committed to that and as far as government policies are concerned, we will pursue this.”

  • Dawha urges workers on innovation

    The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Dr. Joseph Dawha, has challenged the Information Technology Division of the Corporation to evolve ideas and strategies to support the management’s three-point agenda.

    He challenged the staff at the corporation’s IT knowledge sharing and direction setting workshop in Abuja. He said NNPC in the short term would focus on three key areas of ramping up production by its upstream subsidiary, the Nigerian Petroleum Development Company (NPDC) to 250,000 barrels of crude oil daily; boosting gas supply and expanding gas infrastructure to enhance availability of gas for power generation and feedstock for gas-based industries; and driving performance management and improving core processes to instill a culture of performance and boost productivity.

    Dawha, who was represented by the Group Executive Director, Business Development, Dr. Attahiru Yussuf, urged the Division to be proactive in generating ideas and deploying cutting-edge technologies that could promote the efficient and speedy achievement of the three key short-term objectives of management.

    “I urge you to re-equip yourselves in order to play a leading role in accelerating change across the entire Corporation. To lead this transformation, our IT executives must re-imagine their roles by seeing themselves – and encouraging others to see them – as chief executives of an information business.

    “Like any chief executive, our IT leadership should bring vision, direction, and organisation to NNPC’s big data investment priorities. That means engaging internal customers on their biggest challenges while attracting the best talents and suppliers; most importantly, it means being accountable for execution and results,” Dawha said.

    He said he anticipates “firm decisions on five levers that are required to step up the impact of IT in NNPC to enable us achieve the above corporate aspirations.”

    He listed the five levers to include: effective IT governance; availability and stability of connectivity; supportive technology adoption programme; pace of technology assimilation capacity; and consistent use of proven methodology.

  • PENGASSAN, NNPC meeting deadlocked

    •Strike begins midnight

    The Nigerian National Petroleum Corporation (NNPC) arm of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and National Union of Petroleum and Natural Gas Workers (NUPENG) are to shut down NNPC branches nationwide as from  today. This followed a deadlock in their ongoing meeting in Abuja, the Federal Capital Territory, with the management

    of the Corporation and officials of the Federal Ministry of Petroleum Resources.

    A statement by spokesperson of PENGASSAN, Comrade Babatunde Oke, said that the deadline issued the NNPC management to address the Union’s demands on Friday expired midnight yesterday.

    Oke said that the Union’s demands for approval and adequate funding of the pension system, as well as embarking on Turn Around Maintenance (TAM) of refineries and restoration of crude to refineries, have not been met by NNPC management.

    However, the management of NNPC on Monday assured members of staff and the general public that it was taking steps to avert the looming industrial action by the Corporation’s arm of NUPENG and PENGASSAN, it said the National Pension Commission (PENCOM) had given a 12-month window for the Corporation to comply with the Pension Reform Act (PRA) 2014 as amended.

    PENCOM had earlier directed the Corporation to “immediately take all necessary steps to transit to the Contributory Pension Scheme under the PRA. In a fresh directive dated 15 September 2014, PENCOM stated: “In order to accommodate your concerns, the Commission hereby grants the NNPC a transition period of 12 months within which to ensure full compliance with the provisions of the PRA 2014,”  a statement by NNPC’s Group General Manager, Public Affairs Division, Ohi Alegbe, said.

    The Corporation appealed to the leadership of the industrial unions to exercise restraint while it embarks on extensive engagement with PENCOM to resolve the issues. The NNPC noted that since the commencement of the scheme in 2006, the management and its staff have made a lot of sacrifices to maintain the existing scheme and any premature cancellation of the scheme may lead to avoidable labour disaffection across board.

    While acknowledging the existence of some funding gaps in the scheme, the Corporation informed stakeholders that measures have since been put in place to steadily bridge the funding deficit, which stood at N298 billion in 2010 and has now been provisionally reduced to N85 billion as at June, 2014. The statement stated that NNPC is in the process of transferring additional real estate property valued at several billions of naira to the scheme which is currently before the NNPC board for approval.

  • NNPC targets 250,000 bpd, says GMD

    NNPC targets 250,000 bpd, says GMD

    The Nigeria National Petroleum Corporation (NNPC) is targeting the production cut of 250,000 barrels per day, its Group Managing Director Dr. Joseph Dawha said at the weekend.

    The GMD said under his watch, the oil giant would in the short term concentrate on three key areas of ramping up production by its upstream subsidiary, the Nigerian Petroleum Development Company (NPDC) to 250,000 barrels of crude oil per day.

    He said the corporation would also focus on boosting gas supply and expanding gas infrastructure to enhance availability of gas for power generation and feedstock for gas-based industries; and driving performance management and improving core processes to instill a culture of performance and boost productivity.

    Dawha urged Information Technology Division on Innovative Strategies to Support Three-Point Agenda

    He challenged the Information Technology Division of the Corporation to evolve innovative ideas and strategies to support management’s three-point agenda.

    Dawha gave the charge at the 2014 NNPC IT Knowledge Sharing and Direction Setting Workshop in Abuja, according to the Group General Manager, Group Public Affairs Division, Ohi  Alegbe  in a statement yesterday.

    The GMD who was represented by the Group Executive Director, Business Development, Dr. Attahiru Yussuf, urged the Division to be strategic and proactive in generating ideas and deploying cutting-edge technologies that could promote the efficient and speedy achievement of the three key short-term objectives of Management.

    “I urge you to re-equip yourselves in order to play a leading role in accelerating change across the entire Corporation. To lead this transformation, our IT Executives must re-imagine their roles by seeing themselves – and encouraging others to see them – as Chief Executives of an Information Business.

    “Like any chief executive, our IT leadership should bring vision, direction, and organization to NNPC’s big data investment priorities. That means engaging internal customers on their biggest challenges while attracting the best talents and suppliers; most importantly, it means being accountable for execution and results,” the GMD stated.

    Speaking on his expectation from the workshop, Dr. Dawha said he anticipates “firm decisions on five levers that are required to step up the impact of IT in NNPC to enable us achieve the above corporate aspirations”.

    The listed the five levers to include: effective IT governance; availability and stability of connectivity; supportive technology adoption programme; pace of technology assimilation capacity; and consistent use of proven methodology.

    Group Executive Director in charge of the Engineering & Technology Directorate, Engr. Adebayo Ibirogba, said the main objective of the workshop was to get NNPC to “compare notes with the best in Nigeria on how they think, plan, and organize their IT businesses”.

    “Today, we are at the eve of an even faster acceleration in the scope, scale and economic impact of technology as it ushers in a new age of artificial intelligence, consumer gadgetry, instant communication, and boundless information. NNPC simply cannot afford to miss the boat”, Engr. Ibirogba stated.

    He called on participants to use the workshop as a platform for developing a new mindset to recognize Information Technology not just as a primary tool for cutting costs and boosting productivity but as a big business in itself.

    The workshop was attended by other members of NNPC Top Management including the Group Executive Director, Refining & Petrochemicals, Engr. Ian Gregory Udoh; Group Executive Director, Corporate Services, Dr. Dan Efebo; Group Executive Director Commercial & Investment, Hajia Mata Abdurrahman; and Company Secretary  and Legal Adviser, Mr. Ikechukwu Oguine.