An audit report reveals ₦313 billion in unaccounted funds from Nigerian petroleum regulators, exposing financial mismanagement and urging recovery of lost government revenue.
A recent audit by Nigeria’s Auditor General has revealed significant financial mismanagement within two key petroleum regulatory agencies, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). The audit indicates that over ₦313 billion and $2.28 billion in revenue were unaccounted for, resulting in substantial government losses.
The audit, focusing on activities in 2021, identified poor regulatory oversight and violations of financial regulations. Among the highlighted issues were outstanding royalties, unremitted bridging allowances, and inconsistencies in marketers’ debt records. Despite explanations provided by both agencies, many responses were deemed inadequate by the Auditor General.
Key Findings:
- Outstanding Royalties: $1.65 billion in royalties payable by the Nigerian National Petroleum Corporation Limited (NNPCL) was not fully remitted, leaving a balance of $254 million unpaid by the end of 2021.
- Unjustified Deductions: The NNPCL deducted ₦204 billion from oil royalties without proper justification, violating financial regulations.
- Bridging Allowance Shortfalls: NMDPRA failed to collect ₦28.6 billion in bridging claims from NNPCL Retail.
- Outstanding Debts: ₦13.5 billion remained uncollected from three major oil marketers.
- Inconsistent Records: A ₦1.08 billion variance was found in debt records of six marketers, indicating potential record-keeping failures.
- Irregular Balances: ₦14.1 billion was left unpaid by 20 marketers, with no collection efforts reported.
Recommendations:
The Auditor General has directed the Chief Executive Officers of both NUPRC and NMDPRA to recover the outstanding amounts and ensure compliance with financial regulations.
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