The House of Representatives has resolved to launch an investigation on the loss of revenue of Over $60 billion due to inflated cash calls by the Nigerian National Petroleum Company Limited Joint Venture agreements.
The decision of the House was sequel to the adoption of a motion moved at the plenary on Wednesday by Hon Chika Okafor.
Moving the motion, Okafor said that the Nigeria National Petroleum Company Limited (NNPCL) on behalf of the federal government operates Joint Ventures and related agreements with private Oil Companies in both Oil and Gas sectors, with the aim of sustainable revenue generation and economic development;
He stressed that the NNPCL, as representatives of the federal government and federation have about 60 per cent holding while other partners have the remaining 40 per cent.
Okafor added that the joint ventures operate under a “Joint Operating Agreement” that spells out the responsibilities of each of the partners in the ventures;
“Concerned that due to bloated Cash Call Costs, the NNPCL Upstream Investment Management Services (NUIMS), a unit under the NNPCL in charge of negotiation of costs (both Capex and Opex) have caused huge losses in the neighbourhood of ($60,000,000,000) Sixty Billion Dollars over the years,” he noted.
The lawmaker expressed worry that the activities of NNPCL Upstream Investment Management Services (NUIMS) hadresulted in huge revenue losses, fiscal deficits and an alarming debt profile;
The House, therefore, mandated, “the Committees on Finance and Petroleum Resources (Upstream) to conduct a comprehensive investigation on all the NNPCL Joint Venture Operations to determine income and Cash Call costs due to each partner, especially the Federation/ FGN and whether due process and diligence were observed in the exercise.”