"EXCLUSIVE: Jonathan, Alison-Madueke, Okonjo-Iweala culpable in diversion of N8 trillion oil funds"
- by: Ini Ekott and Bassey Udo
President Goodluck Jonathan and two of his top ministers may be
attempting a cover-up on what clearly competes as Nigeria’s biggest
fraud ever, involving the illegal diversion, or theft, of over N8
trillion crude oil sales proceeds.
In a frantic and unusual
memo to the president on September 25, 2013, Central Bank governor,
Sanusi Lamido Sanusi detailed how government-owned oil firm, the Nigeria
National Petroleum Corporation, NNPC, had systematically diverted the
huge sum, being sales proceeds between January 2012 and July 2013.
The CBN governor said for all crude oil sales within the period, the
NNPC paid only 24 percent proceeds into the federation account, and
diverted or stole the remaining 76 percent-totalling N8 trillion.
As the CBN calculated, the NNPC sold at least 594 million barrels of
oil within the period, and should have paid N10.3 trillion (USD65.3
billion) into the federation account. But the corporation paid only N2.5
trillion (USD15.5 billion), Mr. Sanusi said, citing documentation from
pre-shipment inspectors. The whereabouts of the huge balance is unknown.
The weight of the differential is clearer if evaluated against the fact
that the tiny percentage remitted by the NNPC managed to finance the
nation in that period, raising the question of how much the total would
then have achieved for a country unable to pay its university lecturers
who have been on strike for five months.
Put simply, for each
barrel of oil sold, say at an average of USD100, the NNPC illegally
cornered $74 into an unknown account and gave Nigeria only $26.
Mr. Sanusi said he was “constrained” to hint the president after
observing the huge shortfalls for years. He accused the NNPC of
breaching two key federal laws, and urged the president to act
expeditiously by ordering sweeping investigation and prosecution of
those found culpable.
Two months on, the president has refused
to act on the damning memo delivered to him personally by the CBN
governor. In fact, after receiving the letter, the president, presidency
sources say, questioned Mr. Sanusi on why such letter should be
prepared in the first place and sent to him.
PREMIUM TIMES can
also confirm that finance minister and former World Bank chief, Ngozi
Okonjo-Iweala, is also aware of the CBN’s information and has done
nothing about it; while petroleum minister, Alison Diezani-Madueke,
implicated in several corruption probes in the past, is said to be fully
in the know about the massive plunder of crude oil money by the NNPC.
President challenged on corruption
Details of the president’s failure to act on such a massive scale of
misappropriation came amid an increasing criticism of Mr. Jonathan’s
response to corruption, as several senior officials of his government,
accused of stealing or wasting public funds, have been spared of
indictment and prosecution.
The weightiest of such concerns
came on Monday from the speaker of the House of House of
Representatives, Aminu Tambuwal, who publicly accused the president of
consistently displaying a “body language” that encourages corruption.
Citing past scandals, the most recent being the N255 million armoured
car fraud involving aviation minister, Stella Oduah, Mr. Tambuwal said
the president’s penchant for duplicating committees to investigate
corruption cases, rather than directing law enforcement agencies to
probe them, showed Mr. Jonathan was less committed to curbing fraud.
“By the action of setting up different committees for straightforward
cases, the president’s body language doesn’t tend to support the fight
against corruption,” the speaker said at an event in Abuja.
Between 2011 and 2013, the House of Representatives has investigated the
NNPC multiple times, and has in many cases found officials of the
corporation wanting. But no one has been sanctioned by government.
In 2012, top management of the NNPC and the petroleum minister, Mrs.
Madueke, who directly supervises the NNPC, were recommended for
prosecution by the House in a shocking fuel subsidy probe. They accused
officials have remained at their posts.
The CBN’s allegation is the most scathing yet for a corporation notorious for secrecy and corruption.
The diverted or stolen amount-N8 trillion between January 2012 and July
2013- is the nearly the equivalent of the total federal budgets for two
Put together, the sum can run the entire country for
the period, build several new roads and railways, pay wages of millions
of workers, cater for the nation’s teeming unemployed, build thousands
of hospitals and schools, complete ongoing power projects, and on an
urgent note, clear multiple times, all government financial obligations
to university lecturers, whose ongoing strike has kept the universities
shut for more than five months now.
More losses and the ECA
Even so, when compared with prevailing data from different government
agencies, the figure admitted by the CBN is still lesser than what
Nigeria should earn from oil sales.
While the bank said its
computation, based on pre-shipment details, showed that Nigeria sold
N10.3 trillion worth of oil in 19 months, PREMIUM TIMES’ analysis shows
the government should rather realize N10.6 trillion in the first 10
months of 2013-Janaury to October-alone.
estimates is based on the government’s data of daily production average
of 2.11 million barrels of crude, sold at an average price of $105.84
per barrel. If multiplied and converted to naira, the government should have realized N10. 6 trillion in 10 months alone.
But in that period, total oil receipts data provided by the Office of
the Accountant General of the Federation, claimed between January and
October, the government made N5.8 trillion.
Also, our estimates
show that the government has not only lied or misled Nigerians about
its total receipts from oil sales, but is also deceitful about its
earnings in the contentious Excess Crude Account.
The ECA holds
the difference between the real market price for oil and the
government’s projection in the national budget yearly.
2013, the government approved rate is $79 per barrel (called benchmark
for oil price), meaning any raise in price at the international marker,
will go into the ECA.
For most of the year, oil sold as much as
$112 and $114 per barrel. At a conservative rate of $105 per barrel,
the government should have realized $26 as difference per barrel for the
Excess Crude Account.
Calculated at 2.11 million barrels per
day, that should amount to $17.3 billion (about N2.695trillion) earned
as excess crude revenue from crude oil exports as of October 2013.
But the government claims it generated only N986.6 billion in the Excess Crude Account.
No government official could explain the huge gaps for the 2013
figures. The ministry of finance did not comment when contacted multiple
times. Paul Nwabuiku, a spokesperson for the finance minister, Mrs.
Okonjo-Iweala, promised a response but refused to give one several days
A spokesperson for the Central Bank of Nigeria, reacting
to our findings (not Mr. Sanusi’s letter) said as the government’s
banker, it could not provide the requested information, as it was
unlawful for a banker to divulge details about its customer to a third
“We maintain a customer/banker relationship with the
government in the execution of our mandate. We do not divulge such
information to third parties,” Mr. Ugochukwu said on Thursday via a text
Controversy over Excess Crude Account PREMIUM
TIMES’s own evaluation of government oil earnings began well ahead of
obtaining Mr. Sanusi’s letter to President Jonathan.
was prompted by the lingering controversy over the ECA between the
finance minister, Mrs. Okonjo-Iweala and the Rivers state governor,
Mr. Amaechi had accused the government of
depleting the account, usually shared between the federal, states and
local governments. The governor said $5 billion had gone missing from the account under Mrs. Okonjo-Iweala’s watch.
Defending the administration, Mrs. Okonjo-Iweala accused the governor
of “playing politics” on the matter, and said the outstanding $5 billion
had been shared to states as monthly allocation and local governments,
with Rivers State being one of the major beneficiaries.
The frustration of CBN governor
But in his letter, Mr. Sanusi said he had long been frustrated by the
NNPC’s secrecy with oil sales, and that he raised concerns twice to the
president as far back as 2010 about his observation that a huge chunk of
sales proceeds were not remitted to government treasury.
said the shortfall in revenue as a result of oil theft and vandalism in
the Niger Delta was insignificant compared to the scale of money
unaccounted for by the NNPC.
“Your excellency, you will recall
that as far back as late 2010, I had verbally expressed deep concern
about what appeared to be huge shortfalls in remittances to the
federation account in spite of the strong recovery in oil prices,” the
CBN governor wrote, indicating the losses extending years back far
surpasses the N8 trillion of between 2012 and 2013. There is no evidence the president acted on those concerns.
By 2012, he said the situation had gone worse that the government made
more money from tax paid by oil companies than from actual sales of
“This means, Your Excellency, that in this first seven
months of the year, taxes accounted for 76 % of the total inflow from
this sector, while NNPC crude oil proceeds accounted for 24%,” he said.
The CBN governor called for a thorough audit of all domiciliary
accounts held by the NNPC outside of the CBN, and a probe of companies
involved in oil lifting and oil swap.
“As banker to the federal
government and Economic Adviser to the President,” he said, “I am
obliged to draw the president’s attention to these serious issues of
which you have most probably never been aware in this detail,” he said.
The Special Adviser to the President on Public Communications, Reuben
Abati, was not available for comments. He did not answer several calls
made to his telephone. He is believed to be travelling in South Africa
with the president, who is attending the funeral of late South African
President, Nelson Mandela.