The Nigerian National Petroleum Company Limited Joint Venture Agreements caused inflated cash calls, and as a result, the House of Representatives has stated that it is willing to look into the loss of nearly $60 billion in income.
In order to ascertain the income and cash call expenses owed to each partner, particularly the Federation, as well as whether due process and diligence were followed, the House directed the pertinent committees to undertake a comprehensive investigation of all NNPCL Joint Venture operations.
This ruling followed the passage of a resolution on Wednesday at plenary that was supported by Chika Okafor.
Okafor moved the motion, stating that NNPCL, acting on behalf of the Federal Government, manages joint ventures and associated contracts with private oil firms in the gas and oil sectors with the goal of generating sustainable revenue creation, hence promoting the country’s economic development.
The congressman pointed out that other partners make up the remaining 40% of the NNPCL’s ownership, with the Federal government and Federation representing roughly 60% of the holding.
According to him, the “Joint Operating Agreement” that outlines each partner’s obligations in the operations governs how the joint ventures are run.
The legislator stated, “Over the years, the NNPCL Upstream Investment Management Services, a unit under the NNPCL in charge of cost negotiation (both Capex and Opex), have caused huge losses in the neighbourhood of $60 billion due to bloated cash call costs.”
The NNPCL Joint Venture operations require to maintain probity, transparency, and value for money, and the actions of NUIMS have led to significant revenue losses, fiscal deficits, and a concerning debt profile.
To help the Federal Roads Maintenance Agency (FERMA) carry out its duties, the House has called for the remittance of accrued five percent users’ fees on petrol pump prices and diesel.
This came after the Ministry of Petroleum Resources, NNPCL, Nigerian Midstream and Downstream Petroleum Regulatory Authority, Ministry of Finance, and Office of the Account General of the Federation adopted a motion by Aderemi Oseni pleading with them to make sure that the user’s charge is promptly remitted to FERMA in accordance with Section 4(1) of the Agency’s (Amendment) Act, 2007.
Section 4(1) of the Federal Roads Maintenance Agency (Amendment) Act, 2007 states that “The fund of the agency shall consist of 5 per cent users’ charge on pump price of petrol, diesel and of which 40 per cent will accrue to FERMA,” underscoring the significance of funding for road management and maintenance. Oseni led the debate on the motion.
He conveyed the House’s “disturbation that the perpetual non-remittance of N900 billion in user charges on petrol and diesel pumps negatively impacts the FERMA’s finances and performance consequently affecting the state of federal roads” and expressed concern that since the start of the Federal Roads Maintenance Agency (Amendment) Act, 2007, which embodies this provision, the Users’ Charge has not been remitted to the Agency, amounting to approximately N900 billion.
