In a surprising development, evidence shows that Nigeria’s state-owned oil company — the Nigerian National Petroleum Commission (NNPC) — was broke and indebted earlier this year, even as it tried hard to cover it up.
According to Premium Times, the NNPC was trillions of naira deep in debt, the said debt which was due in January this year. This financial crisis is said to have prevented the company from meeting some of its crucial obligations.
Apparently, the state-owned energy company was also broke, a development that was responsible for its inability to import fuel between December 2017 and January 2018 when Nigerians needed it the most.
But instead of making known its predicament, the management of NNPC chose to misinform the presidency, telling the President that Nigerians were consuming too much petrol. According to the NNPC, petrol consumption in Nigeria supposedly jumped from an estimated 35 million litres per day to a huge 47 litres per day.
The NNPC also blamed a supposed depletion in Nigeria’s strategic fuel reserve on alleged diversion and hoarding of the essential commodity.
The NNPC also claimed that it does not have adequate money to fund fuel importation, whilst asking the Government to grant access to the country’s foreign reserves.
In the words of the NNPC’s Group Managing Director, Maikanti Baru:
“The current balance sheet of NNPC group may not support any additional debt capacity based on the 2016 audit report. As at December 31st 2016, current liabilities of NNPC exceeded current assets by 1 trillion naira. In the auditors’ opinion, the NNPC audited financial statement from 2013 up to 2016 indicate that the corporation would not meet its debt obligation as they become due.”
Meanwhile, the NNPC’s problem was even more compounded by an outstanding Federation Accounts Allocation Committee (FAAC) remittances for the months of October and December 2017 valued at N406.13 billion. There were also other financial obligations the company was expected to meet.
The NNPC has reportedly recovered from indebtedness
Meanwhile, a spokesman for the NNPC said on Monday that the company has considerably recovered and stabilised in recent times.
More on the recent damning revelations against the NNPC
As we reported, the Nigerian upper legislative chamber recently launched a new investigation into a controversial $3.5 billion that was supposedly expended by the Nigerian National Petroleum Corporation for the purpose of petrol importation.
There are currently several probes by the legislative arm of Government into the activities of the NNPC.