ABUJA, (Sundiata Post) – The Nigeria Extractive Industries Transparency Initiative (NEITI) said the volume of crude oil lifted and utilized by the Nigerian National Petroleum Corporation (NNPC) between January 2015 and September 2016, amounted to 1.28 trillion barrels valued at $61.17 billion.
A breakdown of the activities shows that international oil companies (IOCs) and independents companies lifted 809.98 million barrels, while government lifted 441.37million barrels and those with alternative financing arrangements lifted 30.15 million barrels.
According to the recent report released by NEITI, the total value of crude lifted for the 21 months was $61.17 billion, out which government, IOCs and independents, and AFs lifted $20.9billion, $38.78 billion and $1.5 billion respectively. The reports also reveal that only 9.74 per cent of the crude lifted by NNPC for domestic crude was delivered to the refineries.
In terms of production, the report noted that crude oil production during the period fluctuated with the highest production per month recorded in October 2015 when it hit 69.49 million barrels while the lowest was recorded in August 2016 with 46.56 million barrels.
NEITI noted that when the production figures for January 2015 (68.07 million barrels) and September 2016 (49.53 million barrels) are compared, there was a decline in monthly production by 27.23 per cent. It added that the same trend was noticeable in terms of average daily production per quarter, as 2.16 million barrels were produced daily on the average in the first quarter of 2015 as against the 1.60 million barrels average daily production per quarter in the third quarter of 2016.
The report attributed the fall in oil production to growing vandalism and militancy in the Niger Delta region, but added that production fluctuation was noticeable even before the onset of militant activities.
NEITI submitted that the fall in daily production may have negatively impact the implementation of the 2016 budget, given that the budget was predicated on a daily production of 2.2 million barrels.
NEITI commended the NNPC for taking the initiative to provide up-to-date information to Nigerians on the state of the country’s petroleum sector through the monthly financial and operations reports that the national oil company has been publishing since August 2015. It however called on NNPC to open up more especially by living up to its self-declared commitments to openness, transparency and accountability.
The reported noted that the NNPC group consistently operated in the red, posting losses of N418.97 billion in 19 months out of the 21 months under review. “The NNPC group made a cumulative loss of N418.97 billion in 19 months,” the report stated.
It added that volatility was also noticeable in the group’s losses, ranging from N3.55 billion in January 2016 to N45.49 billion in September 2015, stressing that the group only made profit in two of the 21 months covered by the NNPC monthly reports under review.
Explaining on when the Corporation made profit, the report stated, “This was in January 2015 when the group made a profit of N7.6 billion and in May 2016 when it made a profit of N0.27 billion, with total profit in 21 months coming to N7.87 billion, as against the loss of N418.97 billion, with total loss coming to N411.1 billion.”
The report stated that the daily average sales of petrol fluctuated between 15.23 million litres in September 2015 and 35.09 million litres in May 2016. The daily average sales for petrol for the 21 months came to 24.24 million litres, while the daily average sales diesel and kerosene came to 1.06 million litres and 3.12 million litres respectively.
According to the report, NNPC in its monthly financial and operations reports voluntarily made some transparency-related commitments that are yet to be fulfilled. These commitments include: development of an index for measuring progress and improving transparency, publication of annual audited report by the second quarter of the succeeding year, undertaking a value-for-money audit of all the federation’s joint ventures, and review of existing production sharing contracts (PSCs). “While we commend NNPC for opening up and for consistently doing so,” said NEITI in the Occasional Paper Series, “the monthly reports also reveal a few things that NNPC has committed to do but which have not yet been done. NEITI is particularly interested in NNPC delivering on these commitments to further promote openness, transparency and accountability in the nation’s extractive industry.”
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