The Office of the Auditor-General of the Federation (OAuGF) has received all the necessary and complete documents required to verify the Nigerian National Petroleum Company Limited’s (NNPCL) N2.7 trillion fuel subsidy claim against the Nigerian Government.
This development follows the procurement department of the Ministry of Finance receiving the terms of reference and scope of work to guide the hiring of an external firm that will assist the OAuGF in conducting the audit.
This audit is part of the ongoing effort to address the NNPCL’s fuel subsidy claims, which have been a subject of scrutiny since April 2024. The Federal Government launched a fresh audit of the N2.8 trillion subsidy claim by NNPCL, with the first audit by KPMG reducing the claim from N6 trillion to N2.7 trillion. The full audit is set to cover the period from 2015 to 2021.
On May 30, 2023, NNPCL’s Group Chief Executive Officer, Mele Kyari, disclosed that the government still owed the company N2.8 trillion for petrol subsidy payments, which the NNPCL had initially covered from its own cash flow. He also stated that, despite continued payments from NNPCL, the government had yet to reimburse the amount.
The most recent update from the Federal Allocation Accounts Committee (FAAC) meeting in September 2024 indicated that the OAuGF now has all the documents needed to proceed with the audit.
The minutes from the meeting reported that the Procurement Department of the Ministry of Finance had provided the terms of reference, and the process of hiring an external audit firm to support the OAuGF’s work was underway. The committee also expressed its commitment to ensuring a thorough and diligent audit process, with oversight and support from the relevant agencies.
Despite concerns raised following the exit of the former NNPCL CFO, Ajiya Umar, the NNPCL spokesperson, Femi Soneye, assured that reconciliation efforts were ongoing with the relevant government agencies and auditors, with the results to be made public once the process is complete.
Meanwhile, the reconciliation of arrears owed to the Federation Account has continued, with revenue-generating agencies refunding a total of N1.19 trillion in the first seven months of 2024.
These reconciliations follow outstanding payments by agencies such as NNPCL, the Nigerian Upstream Petroleum Regulatory Commission, and the Federal Inland Revenue Service.
