NNPC’s Publication of Audited Accounts Signals More Transparency -NEITI

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The Nigeria Extractive Industries Transparency Initiative (NEITI) has described as laudable the decision of the Nigerian National Petroleum Corporation (NNPC) to make public its audited accounts for the first time in its history.

Executive Secretary of NEITI, Mr. Waziri Adio, in a statement yesterday in Abuja, said the move was in fulfillment of a pledge by the Group Managing Director of NNPC, Mallam Mele Kyari, to promote transparency by making public the corporation’s audited accounts.

“We welcome the eventual fulfillment of this important pledge and obligation. Given NNPC’s antecedents and its prominent role in the sector and in the country, the publication of its audited accounts is positive, signalling more openness for the oil and gas sector and for Nigeria.

“When combined with the monthly reports that NNPC started publishing in 2016, this development marks a sea change for a national oil company that used to be renowned for opacity.
“We urge NNPC to make this a routine practice and to mainstream transparency into all facets of its operations,” it said.
NEITI, however, called on the NNPC to go further by publishing its previous audited accounts and in open data formats so that the reports can be more accessible to citizens who are the shareholders of the corporation.

“NEITI also urges NNPC to strengthen and sustain its commitment to data mainstreaming and systemic disclosure,” he added.
The organisation said it was working closely with the NNPC in that direction through a joint committee on remediation and mainstreaming.

“The committee set up by the two organisations was tasked with the responsibilities of examining the status of legacy and other lingering issues about NNPC in NEITI’s reports over the years and to recommend workable strategies for resolving the issues.
“The committee was also charged to devise action plans on systematic disclosure of information on NNPC’s operations in an open and accessible format, as well as data mainstreaming, among others.

“The work of the NEITI-NNPC joint committee on addressing the remedial issues is already at an advanced stage and the report will be made public very soon,” the organisation stated.
It noted that as part of its strategic plan and in line with the Extractive Industry Transparency Initiative(EITI), NEITI has embraced proactive and constructive engagements with entities covered under its reports with a view to reducing audit issues, deepening commitment to transparency and encouraging proactive disclosures.

“We do not want to be the only entity talking about and practising transparency. There is little use being an island of transparency. Our goal is for all our stakeholders to believe in and model transparency.

“And to demonstrate our commitment to this new way of working, we are engaging with all covered entities bilaterally and collectively on outstanding issues and how we can further push the boundaries of openness,” NEITI stated.
The 43-year-old organisation, in its 2018 audited statement posted on its website, did not present a consolidated report of its activities as a unit.

But it made public the accounts of its listed subsidiaries – 20 in all, including companies floated offshore for the corporation’s international business.
While some of the subsidiaries made losses during the period under review, many of them, however, bounced back after years of negative figures, to the path of profitability.

For one of the companies, the Integrated Data Services Limited (IDSL), which provides hydrocarbon exploration services, revenue increased significantly by about N1.3 billion or 7.76 per cent in 2018 from 2017, with total comprehensive income of about N3.2 billion in the same period as a result of actuarial gain.

However, actual profit was N154 million compared to 2017 with just over N4 million, for the company that offers upstream sector geophysical and petroleum engineering services in the oil and gas industry.

For the National Petroleum Investment Management Services (NAPIMS), which executes joint operations and other exploration and production activities for the NNPC and oversees the federation’s interest in the joint operating agreements, in 2017, total revenue stood at N3.2 trillion and increased to N5 trillion in 2018. But it wiped off its loss, which stood at the N1.6 trillion in 2017, and turned in N1 trillion gain in 2018.

The Kaduna Refining and Petrochemical Company Limited (KRPC), in 2018, had an operating loss of N64.5 billion compared to N112 billion in 2017, with total comprehensive loss put at N111.8 billion in 2017 which decreased to N64.3 in 2018.

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