The Auditor-General of the Federation has accused the Nigerian National Petroleum Company Limited (NNPCL) of failing to properly explain how £14.3 million (about ₦27 billion) allocated to its London office in 2021 was spent.
According to PREMIUM TIMES, the concerns were raised in the Auditor-General’s 2022 report, which highlighted several compliance breaches and demanded clarification from NNPCL. The document pointed to lapses in due process, financial discipline, and regulatory adherence.
The audit observed that NNPCL spent £14.3 million on its London operations in 2021, but auditors were not given access to supporting documents that should detail how the money was utilised. As a result, officials could not verify whether the spending was lawful, prudent, or aligned with financial regulations.
The findings indicate clear violations of Paragraph 112 of the Financial Regulations (2009), which mandates accounting officers to ensure strong internal controls and proper revenue accountability. Additional breaches were noted under Paragraph 415—which emphasises spending strictly based on necessity—and Paragraph 603(1), which requires complete documentation on all vouchers, including invoices and purchase orders.
The Auditor-General warned that the lack of transparency exposes the company to “misappropriation and diversion” of funds, attributing the issues to serious weaknesses in NNPCL’s internal control systems.
In response, NNPCL argued that its London office runs as a service centre with an approved budget. The company insisted that the £14.3 million was spent according to operational needs and that the office maintains detailed financial records. NNPCL also faulted the audit for not citing specific transactions, saying this made it difficult to supply tailored evidence.
The company added that it remains committed to improving its internal controls and financial processes.
However, the Auditor-General dismissed NNPCL’s explanation as inadequate and ordered the Group Chief Executive Officer to refund the £14.3 million to the federal treasury. The report warned that penalties under Paragraphs 3106 and 3115 of the Financial Regulations would apply if the money is not returned.
The broader audit uncovered additional irregularities, accusing NNPCL of contract inflation, misappropriation, irregular payments, and tax-related violations amounting to more than $51 million from 2020 to 2021. It also faulted the company for spending ₦684 million on abandoned or unexecuted projects.
NNPCL’s historical lack of transparency was also noted. For over four decades, the company failed to publish audited accounts until 2020—an issue analysts say has fueled persistent accountability concerns.
Currently, the EFCC is investigating 14 NNPCL officials, including former GMDs Mele Kyari and Abubakar Yar’Adua, over an alleged $2.7 billion scandal linked to failed refinery rehabilitation projects in Kaduna, Warri, and Port Harcourt. Despite billions budgeted over the years, the refineries have produced no output.
Separately, the Senate Committee on Public Accounts is examining claims that ₦210 trillion was not properly reported in NNPCL’s audited financial statements from 2017 to 2023. The company reportedly ignored four summonses before submitting a written response last week.
Past audit reports have raised similar concerns — including the 2021 report that indicted NNPCL for diverting and deducting ₦514 billion without approval.
What measures do you think NNPCL must adopt to ensure full transparency and financial accountability?
