A report from a partial audit revealed that the Nigeria National Petroleum Corp (NNPC) has doled out several improper informal loans to the Federal Government, including footing the $14 million bill for a presidential helicopters.
According to a Reuters report the audit was prepared by an external organisation in the government’s bid to improve transparency within the state-owned oil firm and the revelations are damning.
Nigeria’s Federal Government has expressed its hopes that the debt-ridden NNPC would soon emerge an independent profitable company, but the firm is currently fraught with corrupt practices often overlooked by top officials who stand to benefit.
NNPC has a budget agreed by parliament. Other revenue it collects from oil production is meant to be passed to the government accounts, but industry experts say powerful interests tap money before it is sent through official channels, Reuters wrote.
The state-owned oil firm is being owed by several ministries and state agencies that collect informal loans from the NNPC. The audit report revealed that the NNPC doled out $14 million for a presidential helicopter, loaned another $106 million to the state power firm and a whopping $124 million to the maritime security agency.
State governors are threatening to take the federal government to court over illegal tapping of oil revenues that should be shared with local government.
There has been no comment from the Finance Ministry or the NNPC about the illegal debts and the Presidency as well as the oil ministry are quiet on the matter.
A source within the NNPC told Reuters, however, that they are aware of the loans calling them “not ideal”.
The NNPC needs its own funds to pay for joint ventures with foreign oil companies, some of which have lain dormant due to a lack of state investment, the Reuters report said.
“It does highlight the extent to which NNPC has been drawn into the more opaque areas of government – and will give ammunition to those critics who say it has operated at least partly as a slush fund for government,” Antony Goldman, Nigeria oil expert at PM Consulting said.
“It points to the huge difficulties in making independent a corporation with such a complex web of assets and liabilities, at least some of which appear not to have been contracted solely on a commercial basis.”
This latest reveal comes on the heels of reports of massive corruption within the oil sector, billions of dollars in revenue lost to oil thieves and more embezzled by fraudulent oil marketers in the Petroleum Subsidy Fund scheme.
Africa’s oil giant exports some 2 million barrels per day of oil, but still crumbles under the weight of corruption, economic instability and a huge wave of terrorism.